The former chairman of First Active has stepped down from the board following a dispute with its new owners Royal Bank of Scotland (RBS).Mr John Callaghan has also decided not to join the board of First Active's new parent, Ulster Bank, as planned following the €887 million takeover of the former building society by Ulster's Scottish owner, RBS.
However, relations between the Edinburgh-headquartered bank and Mr Callaghan are understood to have soured early this year. Mr Callaghan is understood to have complained that RBS had not delivered on commitments entered into at the time of the takeover.
None of the banks involved would comment yesterday but sources confirmed that Mr Callaghan had indeed resigned his position on the First Active board and had opted not to take up his position on the board of Ulster Bank.
The precise reasons for Mr Callaghan's decision to depart are not clear. However, some dispute about the details of his future position has clearly emerged since the announcement last month of his appointment to the Ulster Board.
Mr Callaghan, a former managing partner at accountants KPMG, joined the board of First Active in 1993. He was appointed vice-chairman in 1997 and took over as chairman in April 1999.
He received a payout of €1.26 million for the 203,090 shares he held in the group following the takeover by RBS.
First Active has retained its own identity and board structure following the takeover and subsequent merger with Ulster Bank. However, the board is subordinate to the Ulster Bank board.
First Active executives succeeded in securing key posts in the merged bank with chief executive Mr Cormac McCarthy now leading the enlarged bank and former First Active finance director Mr Michael Torpey assuming the same position in the new group.
Last month, Ulster Bank said that Mr Callaghan would be joining the Ulster Bank board in a non-executive capacity. However, it now appears the Mr Callaghan never took up his position and, following the breakdown of negotiations with Royal Bank of Scotland, has decided not to do so.
Mr Callaghan could not be contacted last night.
