Interview: Susan Rice, managing director of the Scottish component of the Lloyds Banking Group

HER reputation is unassailable. She is an estimable patron of the arts and an unflagging bastion of social responsibility. Her dedication to bringing banking to the poor and disenfranchised means that if banking ever needed a kindly face, hers would be ideal.

As it turns out, banking does need a friendly face. Particularly as, come January, the sector faces its darkest days yet as the takeover of Scotland's oldest bank by another threatens thousands of jobs and Scotland's reputation as a leading player in the financial services industry.

So it should come as no surprise that Susan Rice was revealed as the managing director of the Scottish part of the Lloyds Banking Group. American-born Rice is already head of Lloyds TSB Scotland and has been for eight years, during which time she has not only doubled the size of the bank's business but has become one of the sector's leading lights north of the Border.

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A capable networker and a skilled leader of people, her profile in Scotland is far higher than many of her banking sector peers. You may not have seen Sir Fred Goodwin or Andy Hornby making speeches or hosting business events but Rice often does.

That it took so long for Lloyds TSB to confirm her status, a full week after HBOS shareholders voted the deal through, was actually beginning to cause disquiet as Rice's many supporters feared she may either move or be moved on. But reaction yesterday from corporate customers and the arts community, where Rice is highly regarded as both a corporate patron and a genuine buff, was unequivocal – they are delighted.

Ivor Tiefenbrun, founder and chairman of hi-fi maker Linn Products, is both a fan of Rice and a corporate customer of Lloyds TSB.

Tiefenbrun says: "Susan Rice is a strong advocate of relationship banking. She doesn't just say it, she means it. She has taken on a bigger responsibility and I am sure she will give full justice to the task."

Yet it is still unclear quite what she will be in charge of as Lloyds is only releasing details about the shape and structure of the new bank in dribbles.

Since the executive board was announced in October, the next tier of management had to wait until each bank's boards got shareholder approval. Now, even very senior HBOS employees in their London base at Old Bond Street and at the Mound are clueless about their positions, let alone Henry Duncan House in Edinburgh, where Lloyds TSB Scotland has quietly got on with its retail and corporate banking business since 1987.

Nevertheless, the combined superbank in Scotland will be referred to as the Bank of Scotland. HBOS in Scotland of course is the much larger of the two, with 320 branches and 17,000 employees. Lloyds TSB Scotland has 185 and 2,000 Although there will inevitably be cuts to both branches and staff, it is still a much bigger role for Rice.

Currently Lloyds TSB Scotland has its own semi-autonomous board which now looks redundant under the new group. A new Scottish executive committee will be formed, reporting to Archie Kane, who as the Lloyds Group board member with responsibility for Scotland and chief executive of Lloyds insurance division Scottish Widows, remains the group's most senior person in Scotland. As managing director, Rice will "play in integral role on the Scottish executive committee supporting Archie Kane".

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That Rice owns Lloyds Group's most capable pair of hands there is no doubt. However, it is as a banking ambassador she has made her mark.

One of her many extracurricular roles is on the board of the Chartered Institute of Bankers (CIOBS), where she has championed the education of bankers as well as financial education in schools.

The former head of CIOBS, Professor Charles Munn, says the future of the currently troubled banking sector will rely on there being more bankers like Rice.

"Her success extends beyond just running the bank because she has become an important person for many aspects of the development and activities in Scotland. She always has her banker's hat on but at the same time she can see things and do things that help ameliorate social conditions."

Her highly developed social conscience emerged early in her banking career in New York, where she worked on funding for housing projects on the tough lower east side.

She did not start out her career as a banker, although her background as a university administrator has clearly informed her collegiate style of leadership.

After education at the exclusive Ivy League Wellesley College in Massachusetts alongside a young Hilary Rodham, later Clinton, she initially became a medical researcher then an administrator in molecular biology at the prestigious Yale and Colegate universities. She met and married Aberdonian Duncan Rice and when he became vice-chancellor of New York University she switched careers.

When the Rices moved back to Scotland she began working at Bank of Scotland, where again she championed some of that bank's more socially inclusive policies. It is uncertain whether Rice's emphasis on the softer side of banking prevented an invitation to the main Lloyds TSB board but it will lend credibility to the tough choices the bank faces in 2009.

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Rice's new job will inevitably be difficult. There will be an outcry as inevitably jobs are cut, branches are closed, arts and sporting sponsorships are cut and lending policies changed.

As someone who is trusted and respected, many believe Rice will deal with the hard business of rationalising the banks "sensitively and sensibly".

Perhaps the question for Rice is not whether she is relieved to have got the job, rather that Lloyds Group is lucky to have kept her.

The timing is also telling. The merger process is likely to take three years. Rice is currently 62 and the last three years until she collects her pension will be arguably the most challenging.

"A lot of people have retired by the time they reach her age," notes Munn. "To have that appetite for the work is just great."


• Susan Rice. Age – 62. Born – Rhode Island, US.

• She started her career in academia, becoming dean of both Yale and Colgate universities. She moved into banking in 1986, working at NatWest Bancorp in New York, where she was senior vice president.

• In 1996, she moved to Aberdeen to become managing director of personal banking at the Bank of Scotland.

• In 2000 she became the first female chief executive of a British clearing bank, Lloyds TSB Scotland, taking over from John Spence.

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• Lives in The Chanonry in Old Aberdeen with her husband, Professor Duncan Rice, principal of Aberdeen University. They have three children aged 18, 24 and 30. The couple have homes in Edinburgh and Harris.

• Rice is also a board director of Scottish & Southern Energy, is chair of the Edinburgh International Book Festival. She is on the board of HMT Financial Inclusion Task Force.

• In 2007 she was appointed to the Court of the Bank of England which manages the bank's affairs other than monetary policy.

• Hobbies include art collecting and her collection includes works by renowned British colourist Howard Hodgkin. She was awarded an honorary doctor of laws qualification by Aberdeen University in November.

• She was made a CBE in 2005, and has been presented with six other honorary titles from Scottish universities.