UK hires Bank of America executive O'Neil in bid to revive growth

By Tommy Reggiori Wilkes

LONDON (Reuters) -Britain's finance ministry said on Wednesday it had hired Bank of America executive Jim O'Neil as a senior official as part of its efforts to boost weak economic growth.

O'Neil, one of Bank of America's top bankers in the region as its head of corporate and investment banking in Europe, the Middle East and Africa (EMEA), will start in July as Second Permanent Secretary to the Treasury, the ministry said in a statement.

The U.S.-born, London-based executive will have the job of attracting more private investment, removing barriers to growth and building open and fair trade, the ministry added.

Britain's Labour Party was elected last year on a promise to get the economy growing faster but it has struggled to do that so far, with concerns about U.S. trade policies further souring the outlook.

O'Neil's appointment comes as the government tries various levers to kick-start growth, including vowing to cut red tape and overhauling planning rules.

On Tuesday, British pension funds pledged to pump up to 50 billion pounds ($66 billion) of additional investment into UK businesses and infrastructure, as the government leans on private capital to fund public projects and boost growth.

Britain's services sector, accounting for much of the economy, shrank in April for the first time since October 2023, according to a survey published last week.

"I’m very pleased to welcome Jim as our new Second Permanent Secretary, his extensive knowledge of the private sector will be vital in helping us deliver our number one mission to grow the economy," Finance Minister Rachel Reeves said.

O'Neil, who first joined Bank of America in 1993, has past experience working in the public sector. Before re-joining the American bank in 2013, he spent three years at the UK government body that managed taxpayer holdings in bailed-out banks.

"We are living through a time of great change globally, making the need for an economy of stability, resilience, and growth all the more important," O'Neil said.

UK governments often turn to the private sector for certain senior appointments in the finance ministry.

In the wake of O'Neil's departure, Bank of America appointed Jeff Tannenbaum as head of corporate and investment banking for EMEA, reporting to Matthew Koder and Bernie Mensah, according to an internal memo seen by Reuters and confirmed by the bank.

Tannenbaum, formerly head of EMEA capital markets, is a veteran of the firm. He started as a summer intern in 1998.

($1 = 0.7522 pounds)

(Reporting by Tommy Reggiori Wilkes; Editing by Anousha Sakoui and Hugh Lawson and Andrew Heavens)