Lead­er­ship race heats up at Bank of Italy that Draghi once headed

Muscat Daily - - BUSINESS -

Rome, Italy - The euro area’s third-largest econ­omy is seek­ing some­one to help over­see its strug­gling re­cov­ery - and re­view the Euro­pean Cen­tral Bank (ECB) stim­u­lus the coun­try re­lies upon.

Com­pe­ti­tion for the top job at the Bank of Italy, which comes with a seat on the ECB’s Gov­ern­ing Coun­cil, is heat­ing up. The po­si­tion has a high-pro­file his­tory - ECB pres­i­dent Mario Draghi led the Rome-based cen­tral bank from the end of 2005 un­til 2011, and ear­lier gov­er­nors Luigi Ein­audi and Carlo Azeglio Ci­ampi went on to be na­tional pres­i­dents.

Although Draghi’s suc­ces­sor Ig­nazio Visco could be reap­pointed when his term ends this fall, the field is filled with cred­i­ble po­ten­tial can­di­dates such as Fi­nance Min­is­ter Pier Carlo Padoan, ac­cord­ing to Ital­ian me­dia. Other names in the frame in­clude ECB su­per­vi­sory board mem­ber Ig­nazio An­geloni and - in what would be a break with tra­di­tion - econ­o­mist Lu­crezia Re­ich­lin.

The changeover comes at a sen­si­tive time for the ECB, which is about to con­sider whether the euro area’s ro­bust re­cov­ery war­rants wind­ing down its quan­ti­ta­tive-eas­ing pro­gramme. The dif­fi­culty for Italy is that it is prob­a­bly the re­gion’s big­gest weak spot, with slow growth and an acute prob­lem of non-per­form­ing loans.

The 67 year old Visco, who started his six year term on Novem­ber 1, 2011, has run into crit­i­cism over his han­dling of the coun­try’s bank­ing predica­ment, lead­ing to spec­u­la­tion he may be a one-term gov­er­nor.

The cen­tral-bank chief must be ‘able to suc­cess­fully deal with Italy’s bank­ing cri­sis, which isn’t over yet’, said Luigi Zin­gales, a pro­fes­sor at the Univer­sity of Chicago Booth School of Busi­ness, who him­self has been men­tioned as a pos­si­ble choice by Rome’s la Repub­blica news­pa­per.

Visco’s chal­lengers may in- clude two close col­leagues at the cen­tral bank, se­nior deputy gov­er­nor Sal­va­tore Rossi and deputy gov­er­nor Fabio Panetta, ac­cord­ing to news re­ports. Like An­geloni, Panetta is a mem­ber of the board of the ECB’s sin­gle su­per­vi­sory mech­a­nism, which over­sees the re­gion’s largest lenders.

An­other pos­si­ble pick is said to be An­drea En­ria, chair­man of the Euro­pean Bank­ing Au­thor­ity.

Gen­der might play a role, giv­ing an edge to can­di­dates such as Lu­crezia, cur­rently a pro­fes­sor at Lon­don Busi­ness School. If cho­sen, she would be­come the cen­tral bank’s first woman gov­er­nor in its more than 120 year his­tory.

Ig­nazio Visco

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