Equitable finance chief quits after only 18 months

The troubles at Equitable Life continued to deepen yesterday with the shock resignation of its chief finance officer, Charles Bellringer, only a week after the society revealed it was on the brink of insolvency.

Mr Bellringer leaves after just 18 months in the job, with a pay-off in the region of £175,000 that includes six months' salary, a car allowance, a pension contribution and a bonus.

His pay-off has provoked outrage from Equitable's embattled policyholders, 50,000 of which were told last week that their pensions would be slashed by up to 20 per cent. "The society is unravelling before our eyes," said Paul Braithwaite, chairman of the Equitable Members' Action Group. "It is obscene to make a voluntary pay off to a director at the same time as reducing pensioners to penury."

Mr Bellringer told policyholders in May that "your society has always been solvent, is solvent, and we fully intend to keep it that way". The company's report, however, revealed the stricken life assurer may not be able to meet its minimum solvency requirement or repay its £346m in bonds. Equitable's financial woes began two years ago when it was forced by the House of Lords to honour pension levels that it had guaranteed.

Mr Bellringer, who joined Equitable in May last year, was paid £210,000 a year to rescue the company's finances and secure it from going in to liquidation.

As it was unable to meet its guarantees, and its assets ravaged by the falling stockmarket, Equitable has had to cut policy values, agree a compromise scheme with policyholders to cap its liabilities, and pile out of equities. Thousands of policyholders have left the with-profits fund and last week Equitable revealed it had a margin of just £400m over the reserves it is required to hold by regulators. Equitable now only has around £1bn of its assets in equities, just 5 per cent of its portfolio, compared with 13 per cent at the end of June.

Steering the finances of the company through the compromise agreement and overseeing the selling of £10bn of equities has proved not enough for Mr Bellringer, 47, who said he wanted to "find a new and wider challenge". He began talks with the chief executive, Charles Thomson, over his future with Equitable after the accounts were published and reached a mutual agreement for him to leave with immediate effect.

Mr Thomson said: "We still have a number of issues ahead as we seek to stabilise further the with-profits fund and reduce our costs." The search is now on for a replacement to Mr Bellringer.

A spokesman for Equitable said a temporary appointment from outside the company would be made before a permanent replacement was found, but dismissed it would be difficult to attract a candidate of calibre given the society's desperate financial condition. Mr Thomson added: "The recruitment of a successor is in hand. In the meantime, we have the benefit of an experienced team of finance professionals who will assume day-to-day management of the finance operations until a new appointment is made and Mr Bellringer has agreed to assist the society during this transition."

News of Mr Bellringer's departure comes as the Equitable board admitted it, and not the Inland Revenue, was behind the decision to stop policyholders with with-profit annuities from leaving the fund.