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RBS urged to speed up its hunt for Hester's successor

RBS urged to speed up its hunt for Hester's successor

Royal Bank of Scotland (RBS) has been urged to speed up its hunt for Stephen Hester's successor.

Analysts at Investec, the investment bank, believe RBS should 'act decisively' and appoint Ross McEwan as Hester's replacement.

In a note to clients it argued that while RBS' shares had risen 24% over the last 11 trading days - outpacing both the FTSE 100 and a host of other large cap banks - uncertainty surrounding the vacant chief executive position may be holding its shares back.

Downgrading RBS from a 'buy' to a 'hold', financials analyst Ian Gordon said: 'If the board were to act decisively and appoint Ross McEwan, who would be our top pick, within the next few weeks, we believe it would help to remove significant strategic uncertainty.'

Another cause for concern is RBS' eventual division between its retail and investment banking arms, however Gordon added he was not overly negative on the stock because announcing Hester's replacement would convince investors their interests were protected.

McEwan was named RBS' chief executive of UK retail last August after the state-backed lender lured him from the Commonwealth Bank of Australia, where he served in a similar role.

He has always been among the favourites to replace Hester (pictured), who departed RBS in June after the bank said should be ready to return to private hands in 2014.

However he faces tough competition for the role, with RBS' Nathan Bostock, its restructuring head, and Rory Cullinan, its non-core business head, also regarded as worthy replacements for Hester. 

Shares in RBS were trading at 336.5p shortly before 11.10am, up 0.6% on the day but some way off its 379.6p 52-week peak.

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