Close Brothers chief executive takes medical leave of absence from banking group

Close Brothers has announced that its chief executive has taken a leave of absence for medical reasons.

It was not indicated when Adrian Sainsbury will return to the banking group from the temporary medical leave.

Mr Sainsbury has been at Close Brothers for more than a decade, joining in 2013 as head of its commercial division before rising to chief executive in 2020.

Before that, he held senior roles at the Australia and New Zealand Banking Group, Bank of Ireland and Royal Bank of Scotland.

The company said Mike Morgan, Close Brothers’ finance director, will take on Mr Sainsbury’s responsibilities in the meantime, including hosting the group’s full-year results announcement on September 19.

Chairman Mike Biggs and members of the senior management team will also help take on the responsibilities, Close Brothers said on Monday.

The firm said in a stock exchange announcement: “A further update will be provided in due course.”

At its interim results, Close Brothers saw operating pre-tax profit surge by 700% in the six months to the end of January, compared with the same period a year ago.

However, the banking group also said earlier this year that it would bolster its finances by £400 million and cut costs as it prepared for the impact of a major investigation into car finance mis-selling practices.

The Financial Conduct Authority (FCA) is looking into whether car finance lenders mis-sold products to customers by using hidden so-called discretionary commission arrangements.

These are where lenders let brokers and car dealers hike the interest on car finance agreements to increase the amount they get on commission, meaning customers overpay without knowing.

Close Brothers, which owns a motor finance arm, followed several other banks in setting aside hundreds of millions of pounds to cover potential costs.

The FCA investigation is set to finish this year.