British bank Northern Rock today said Matt Ridley had quit as chairman to be replaced by former Standard Chartered chairman Bryan Sanderson.
Northern Rock, forced last month to seek emergency funds from the Bank of England due to the global credit crisis, said Mr Ridley's resignation would take effect as soon as Sanderson is approved as his successor by Britain's Financial Services Authority.
By 2.12pm Northern Rock shares were down 3.3 per cent at 197.8 pence, valuing Britain's fifth-biggest mortgage provider at just under £900 million sterling ($1.8 billion).
The spokesman said the process of appointing Mr Sanderson had been in place since before Mr Ridley underwent a three-hour grilling of Northern Rock directors by legislators on Tuesday.
During that questioning, Michael Fallon, a Conservative MP, asked Mr Ridley: "Does no one have any honour? Has no one offered to resign?"
Mr Ridley replied: "I have made it clear that my resignation is available as soon as it is decided it is in the best interest of shareholders and stakeholders that I go."
The Newcastle-based lender has borrowed an estimated £16 billion at a penal interest rate from the Bank of England in the past five weeks.