John Jackson says the departure of two top executives of Kinnect is a disaster for electronic trading at Lloyd's
For Lloyd's to have lost one of its two top executives involved in its electronic trading platform Kinnect could be construed as a setback. To have lost both at the same time is a calamity.
The sudden decision of both chairman Iain Saville and chief executive Toby Davies to quit with only one in ten of Lloyd's companies having signed up to the new way of doing business, must put a big question mark over Kinnect's future.
At a time when the general commercial market is beginning to sign up to the imarket electronic trading system, this is not the time for Lloyd's to be seen to take a step back - more like a giant stride - at this time.
It is particularly worrying, since Iain Saville had been the top executive of the Stock Exchange settlement system Crest, and was clearly the ideal man for the job at Lloyd's.
It is not as if Kinnect was the new kid on the electronic block - some £70m (a number of market watchers put the figure much higher) has already been spent bringing Lloyd's from the age of the quill pen into the 21st century of electronic trading.
Coming as it does in the same week that Lloyd's estimates Hurricane Katrina, which has devastated three southern states of the US, will cost underwriters £1.4bn, the timing of the announcement was not a good one for the market.
Getting Lloyd's off paper has been a bit like getting a drug addict to go 'cold turkey' into rehab, even though there are many leading players in the market who have shown the old Lloyd's entrepreneurial spirit and enthusiastically embraced electronic trading.
That the loss of Saville and Davies is a serious setback for confidence in Kinnect cannot be denied. For them both to have resigned at the same time shows that something, somewhere, is not right.
There are three key things the market now needs: reassurance, reassurance, reassurance. Lloyd's should make a public statement as to why its top two executives have quit and how they see the future of Kinnect.
A great deal of time, effort and cash has been spent on this system, and there can be no fudging.
Lloyd's has been slow to embrace electronic trading, as the current poor take-up of Kinnect has shown. That is not to say it does not want to move with the times, but that at many underwriting desks change moves like a large ship changing course - slowly and in a very big circle.
Someone must be seen to be at the helm with a clearly plotted course and a determination to get to its ultimate destination without further mishap. IT