Bank of England Governor Bailey Says Bank Is Keeping Options Open
Andrew Bailey, head of the UK finance industry, appointed as the new Governor of the Bank of England.
The news, first published by the Financial Times on Thursday, was confirmed by UK Treasury Secretary Sajid Javid on Friday morning.
«When we launched this process, we said we were looking for an international leader with expertise in monetary, economic and regulatory issues. At Andrew Bailey, that’s exactly what we found», – said Javid at a press conference on Friday.
The new appointment is widely seen as a demonstration of continuity at a time of mounting fears over the UK economy. Former UK regulator Mark Carney, who was scheduled to step down at the end of January, will now step down on March 15 to ensure an orderly transition.
Javid said 60-year-old Bailey will begin his work on March 16, and the Treasury committee of the House of Commons will have time to hold a preliminary hearing.
The finance minister added: «Andrew was an outstanding competitor. He is the right person to lead the Bank of England as we create a new future outside the EU and growth opportunities domestically».
Bailey’s appointment was announced Friday in the same room in the Treasury where Gordon Brown declared the independence of the Bank of England in 1997..
Bailey joined the Bank of England in 1985 and has worked in a number of areas, including as Executive Director of Banking Services. During 30 years at the Bank of England, Bailey helped strengthen the banking system against the global financial crisis. Since 2016, he has chaired the industry’s oversight body – Financial Conduct Authority (FCA).
Bailey’s aptitude questions were raised following a series of scandals during his tenure as head of the FCA. These include an investigation into a division of the Royal Bank of Scotland’s global restructuring group and oversight of a multibillion-pound fund managed by stock market star Neil Woodfood until it was suspended in June..
However, Javid defended Bailey’s choice, saying the central bank veteran had «experience, reputation and character» for work, and that he was «without a doubt the best candidate».
Carney has been heavily criticized for his warnings about the potential impact of Brexit on the UK economy. There is speculation that Boris Johnson was interested in the appointment of Gerard Lyons, a close ally and supporter of Brexit, who served as his economic advisor as mayor of London..
«It is striking that even at a time when there are very different views on the best way to manage our economy, all parties agree that the independence of the Bank of England is essential to a strong economy.», – said Javid.
Bailey, who will become the 121st Governor in the Bank of England’s 325-year history, will serve for an eight-year term and will be paid £ 495,000 a year. His pension is expected to be less than Carney’s.
Bailey’s choice will be seen by many observers as a missed opportunity to appoint a woman to head the central bank for the first time. Two women are believed to be shortlisted: Minosh Schafik, a former Deputy Governor of the Bank who is currently director of the London School of Economics, and Sri Vadera, a fellow labor and investment banker who heads Santander UK. Questions have also been raised over whether the UK will be able to take the lead internationally amid increasing political turmoil over Brexit..
Kevin Walsh, a former member of the Board of Governors of the United States Federal Reserve, is also believed to have run in the elections.