Warburg Group Chief Executive Cairns Resigns

S.G. Warburg Group announced Monday that its chief executive, Lord Simon Cairns, has resigned from London’s biggest investment bank.

Warburg’s chairman, Sir David Scholey, takes over the duties of chief executive at the bank, which has shown signs of trouble ever since a proposed merger with Wall Street powerhouse Morgan Stanley collapsed in December.

Last week, the joint heads of Warburg’s equity capital markets division, Maurice Thompson and Michael Cohrs, defected to rival Morgan Grenfell, along with eight colleagues.

Analysts have suggested that lower profits at Warburg will make it hard for the company to retain its most talented investment bankers because competitors will see the time is right for luring them away.

In a statement, Warburg gave no reason for Cairns’ resignation, but British newspapers reported that the company’s board held an emergency meeting on Sunday to discuss his future.

Warburg executives did not immediately return phone calls.