The surprise departure of Royal Bank of Scotland boss Stephen Hester, reportedly at the request of the British government, has sparked questions about the strategy for the state-rescued lender, according to analysts. Hester's exit, revealed on Wednesday, sent shockwaves through Britain's financial sector because he had previously said that he wanted to complete the Edinburgh-based bank's difficult journey out of government ownership back to the private sector.
The announcement has fired the starting gun on a race to find a successor - but experts warn that finding a new chief executive will be a challenge because of fears of political interference at the 81-percent state-owned institution.
Analysts believe that British finance minister George Osborne wanted a new face to help guide Royal Bank of Scotland's return to private ownership, which is not expected until late 2014 at the earliest.
And they warn that the subsequent slump in the company's share price - which tumbled by more than eight percent on Thursday morning - shows that Hester's ousting could hamper the process even further.
"The share price decline is perfectly justified as markets perceive Hester's exit as a forced move by the UK government who are constantly politically interfering in order to score points," said trader Joe Rundle at ETX Capital.
"Hester was robust in his response to deliver value to shareholders... but his exit now throws in questions over how quickly a return (to the private sector) can be realised."
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