B&B bidder plans a new lease of life for banking 'zombies'

At the end of the protracted process, he said he was launching "Resolution the next chapter". He got to keep the name, and it was clear he had something up his sleeve. He even gave a steer as to what that might be. Describing himself as a "value catalyst", Cowdery, who welded together four closed life assurers before flogging the lot, said he was looking at "thinly spread financial groups in the UK and Europe, which require restructuring". Resolution, he asserted, "will accelerate the inevitable restructuring of financial services in the coming years in a way that bridges the gap between public and private equity."

This week, he made his move - promising to inject £400 million into Bradford & Bingley and chucking over-board the bank's rights issue and investment from TPG, the private-equity group. Cowdery's ambition doesn't stop with the B&B.

He wants to use the bank as a springboard to mop up banking's second division, including Northern Rock, Alliance & Leicester and Bristol & West. The idea is that these struggling smaller lenders - and to them can be added Paragon, Kensington Mortgages and the mortgage books of some of the biggest investment banks - will be rolled into one heavyweight institution.

It's clever and daring. In all, Cowdery can point to 15 or so lenders that have been sent reeling in the current crisis. These living dead - for what is that they have effectively become - are not unlike the funds he targeted with his original Resolution. They too enjoyed "zombie" status.

The City is full of very smart bods, ones who rate themselves incredibly highly and dream up big thoughts. The trouble is that is how they remain, as fancy schemes on an easily erased wipeboard. I'd say there are about half a dozen who have the ability and, frankly, the balls to put meat on their left-field ambitions. Osmond is one, Terry Smith is another, possibly Michael Spencer.

Cowdery, definitely. They're all of a type: financial entrepreneurs, not easily tied down, lone operators who prefer to run things themselves or not at all.

The major banks take pride on their talent within, on undergoing the most exhaustive trawl of the top universities and only hiring the best brains. Yet it's someone like Cowdery, who doesn't work inside a large organisation and has only three O-levels to his name, who has the vision to take an industry by the scruff of its neck and give it a good shaking.

"Lots of people can spot gaps in the market place but few have the tenacity, drive and good humour to make it happen," says Keith Skeoch, chairman of the Association of British Insurers' investment committee and chief executive of Standard Life Investments. "That's the difference."

That said, he's not every one's cup of tea is Cowdery. He talks 19 to the dozen and is fond of airing his opinions on anything and everything, even though they've not been solicited. He also likes telling how he sees it and how it should be - something, to his delight, that usually ruffles feathers.

Even his Establishment targets, however, can't begrudge the fact he's given away much of his estimated £150 million fortune. His Resolution Foundation, aimed at educating low-income families about finance, has received tens of millions of pounds from him since its formation in 2005 - making him one of the City's biggest philanthropists. In this, he's similar to those not easily bracketed hedge-fund operators Chris Hohn, at The Children's Investment fund and Philip Richards at RAB Capital. They too are mavericks who make the rest of capitalism feel uncomfortable.

A deliberate iconoclast - he claims never to use a computer - Cowdery's rebel image was aided by his scruffy, overweight, unshaven appearance. That has changed recently, thanks to a strict fitness regime.

Now 45, he grew up the middle of five children born to a single mum near Bristol (he still speaks with a West Country accent). He never knew his dad, and school was the local comprehensive.

The next decade is something of a mystery. He doesn't like talking about it in detail but it seems he fell in with an evangelical church in America and joined it full-time. He married young, aged 20, and had five children - he subsequently divorced and remarried, to Tina, with whom he has a young son, Jack.

In his mid-twenties, with small mouths to feed, he decided to earn some money. He joined an insurance brokers in Cornwall and sold policies to the mostly poor folk of the county - something that is reflected today in his charity and his views of the tax and benefits system.

Despite Cowdery's giving, he is no fan of Gordon Brown, believing as Chancellor he did not do enough to reform the welfare state so that taxation is genuinely progressive. He maintains, for example, there is little point in granting tax credits to the wealthy as they would put money aside anyway and, instead of helping them, more attention should be paid to the less well-off, to encourage them to save.

What's marked Cowdery out is that he's constantly thinking. "I'm fascinated by gaps and inefficiencies; seeing if I can take them and correct them. That's my intellectual motivation. There's also a commercial motivation and there's a social motivation."

In Cornwall, instead of just selling policies, he came up with new twists, ones aimed at his clientele - and which drew him to the attention of the wider industry. He went from salesman to setting up his own consultancy, Broker Marketing. Jacob Rothschild, no less, took notice, and he helped found J Rothschild International Assurance in Dublin. That became Scottish Amicable International and, when the Pru acquired ScotAm, he bowed out, with "a few million".

The desire to better and to push himself kicked in. Rather than retire to the golf course, he joined Jack Welch's General Electric. His reasoning was simple: he wanted exposure to corporate America and he wanted to learn from a master.

He stayed four years, helping Welch reorganise GE's myriad European insurance businesses. Again, he wasn't prepared to go with the flow - after looking at Royal & Sun as a possible purchase for GE, he realised there was enormous potential in the most unsexy area of what is, let's face it, an already unglamorous market: the funds that were prevented by more stringent capital adequacy regulations from seeking new business but had a plethora of existing policy holders still to service.

On their own, these closed funds were going nowhere but by putting them together, Cowdery could make them more efficient and profitable. He was confronted with plenty of sceptics - those who had a vested interest in keeping their company independent, but also politicians and regulators who smelled a rat and thought he was some sort of capitalist vulture. He won the authorities round with the simplicity of his argument. The funds were less keen. "Blood was running in the insurance sector. Boards were not able to countenance the kind of hit to book valuations that a sale right at the bottom would have involved."

For closed funds then, read second-tier banks today. Their boards are also confronted with the uncomfortable reality that their proud organisation is nowhere near as grand or valuable as they thought.

It's early days in Cowdery's second coming - his plans remain vague, and TPG has responded by saying it also sees B&B as a stepping-stone towards consolidation of smaller UK and European banks.

There's no question, though, as to his seriousness. There's a gnawing, relentless aspect to him that says he will not go away, and his reasoning will be aired. He's a natural salesman who is driven by curiosity and a thirst for knowledge - as opposed to base profiteering - and that makes him a very dangerous opponent indeed. A voracious reader, he actively welcomes debate and exchange of philosophies.

As the banks brace themselves, they might like to consider that in his office he keeps a three-foot-high statue of a Russian soldier clutching a machine-gun. He calls him "Vladimir, a 1932 Bolshevik", explaining that "if I have any politics, it is that I am conscious of the power and horror of ideology".

They may want to wonder, too, at someone whose idea of a perfect Sunday evening is to head to the pub in Fulham where he lives, clutching the newspapers. He orders a pint, sits at a corner table and cuts the articles that interest him, to file them away for future reference. The G&T crowd who occupy many of the chairs in the boardrooms of the banking also-rans had better beware.