FIONA McBain is to step down as chief executive of Scottish Friendly, Scotland’s largest financial services mutual, after 11 years in charge which she said left her with a massive list of things to be proud of.
Ms McBain said she had decided last year that she wanted to leave the Glasgow-based company to seek new challenges but had delayed making the move while the firm completed an acquisition which doubled its assets under management.
“It’s been a long time in the planning,” said Ms McBain, who noted that she had started talking to the Scottish Friendly board about her desire to move on last year.
“It was still a difficult decision to make and I feel a huge amount of emotion in announcing it today,” she added.
Ms McBain, 55, said she would take time to reflect on what to do next after focusing on supporting the board as Scottish Friendly integrated the Marine General & Mutual operation it acquired in June 2015. This brought with it £1 billion of assets to manage and 60,000 customers.
The deal was the seventh completed by Scottish Friendly under Ms McBain’s strategy, which involved growing the scale of the business in order to help it survive in an increasingly competitive market.
Scottish Friendly is one of the survivors of a friendly society movement which prospered in the nineteenth century, by providing ways for large numbers of people to save relatively small amounts.
It began life in 1862 as the City of Glasgow Friendly Society, offering funeral and sickness benefit plans to lower income families in the city.
Many societies have surrendered their independence or stopped writing new business. M&GM had closed its book when Scottish Friendly took over.
However, Ms McBain noted: “We took the received wisdom that friendly societies were not efficient and turned it on its head.”
She noted that Scottish Friendly has grown to have around £3bn assets under management and three million customers but only employs around 100 people.
The company can match the efficiency of much bigger public limited companies and is on track to achieve record sales in the current year.
Ms McBain believes being mutually owned by its customers has been key to the society’s success.
Scottish Friendly can react swiftly to challenges without having to meet the short term earnings targets that PLCs are measured by.
The validity of the model was underlined during the global financial crisis when giant banks including Royal Bank of Scotland came close to collapse.
“We came out of the global financial crisis stronger than when we entered it and not many others can say that,” said Ms McBain, who will stand down on 31 December.
She will be succeeded by her deputy, Jim Galbraith, in a development that will help ensure continuity.
Mr Galbraith said: “I look forward to working with everyone at Scottish Friendly to continue to develop the Group’s ‘innovate, diversify and grow’ strategy.”
A qualified chartered accountant, MS Bain took charge in 2006 after working for Scottish Amicable through its takeover by the publicly-quoted Prudential.
Soon after her appointment, Scottish Friendly bought two mutual minnows in Manchester and Preston. It then unveiled a deal to take over local rival Scottish Legal Life, adding £200m to its then £500m of assets.
The firm developed an administration platform for the new breed of ‘wrap’ assets, which was sold to Citi for more than £20m in 2011.
Ms McBain struck deals to have Scottish Friendly’s products distributed by bigger firms, including Royal London and to provide back office services for others.
Scottish Friendly grew sales 18 per cent, to £25.5 million, last year, from £21.6m in 2014.
When announcing the results, the firm said white label sales to other providers such as Smart Insurance and its customer-friendly online ISA platform had helped to fuel growth.
Ms McBain did not rule out working as chief executive of another financial services operation but noted her experience of business transformation work could be applied in other industries.
Scottish Friendly’s chairman Michael Walker said of Ms McBain: “We respect and understand her decision after 11 years in charge to look for new opportunities and challenges but we shall still miss her.”
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