Race to replace L&G boss in overdrive

INSURER Legal & General has stepped up its hunt for a successor to formidable chief executive David Prosser. The Welshman is due to step down in March 2006. L&G is expected to update shareholders at its annual meeting on 27 April.

The company has a distinctive culture and is thought likely to favour an internal candidate. Contenders include finance director Andrew Palmer, 53, director of UK operations Robin Phipps, 53, and Tim Breedon, 45, who runs L&G's fund management division. Retail distribution director Kate Avery, 43, is also believed to be in the running.

Chairman Rob Margetts has appointed a firm of headhunters to scour for an external candidate.

Keith Satchell, currently boss of Friends Provident, is seen as one possibility. Another is Mark Tucker, passed over in favour of Jonathan Bloomer for the top job at the Pru and now finance director at HBOS. Bloomer himself may become free but is not likely to be a front runner.

Prosser, 61, has already extended his retirement date by two years. He is widely regarded as having steered L&G through recent bear markets with skill, thanks mainly to a well-timed £800m rights issue in 2002.

This year he was embroiled in a showdown with the Financial Services Authority over mortgage endowment mis-selling that left both sides nursing wounds.

Prosser is a non-executive director of InterContinental Hotels but has devoted himself almost exclusively to L&G rather than risk the distraction of outside activities. Whoever takes over from him will be expected to continue L&G's strategy of organic growth and relentless thrift.