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Northern Rock chairman Matt Ridley has announced his resignation following the beleaguered bank's difficulties in the past few months.

Mr Ridley said that he was willing to resign last month but the bank's board asked him to stay on until new funding arrangements had been put in place and to face questions from the Treasury select committee.

"He and the board now believe that in the interests of all stakeholders in the company, the time is right to accept his resignation as a director and chairman of the company," a statement from Northern Rock said.

Mr Ridley faced a grilling from MPs earlier this week to explain his role in the crisis which resulted in the first run on a British bank in almost 150 years.

Last month worried savers withdrew more than £2 billion from Northern Rock after it emerged that the company had asked the Bank of England to act as its lender of last resort.

Mr Ridley insisted that Northern Rock could not have predicted the worldwide credit squeeze, which came after the collapse of the sub-prime mortgage market in the US.

Former Bupa chairman Bryan Sanderson will take over as chairman following approval from the Financial Services Authority (FSA).

He has also been a director of BP and chairman of the Learning and Skills Council.

Sir Ian Gibson, senior independent director of Northern Rock, thanked Mr Ridley "for his hard work" during the last three years as chairman, "particularly for his commitment during the very difficult circumstances of the last few months".

"The board is delighted to welcome Bryan Sanderson to the company," he added.

"He has a wealth of experience in business, banking and working with government that will prove invaluable to Northern Rock when considering future strategic options."