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     LONDON (MNI) - Central Bank of Ireland Governor Philip Lane is the clear
favourite to be the European Central Bank's next chief economist now that
Italian Andrea Enria has been nominated to take over the ECB's banking
supervisor, at least five ECB sources told MNI.
     The conclusion of the race to succeed Daniele Nouy, whose five-year term as
chair of the Supervisory Board expires at the end of 2018, filled the first
piece in a jigsaw of major ECB appointments over the next year, with Chief
Economist Peter Praet stepping down after May 31 and President Mario Draghi
leaving in November.
     Enria, whose appointment has still to be confirmed by the European
Parliament and member states, beat Ireland's Sharon Donnery in a secret ballot
Nov. 7, thanks to support from southern European countries and from Draghi
himself, different sources said. As the current head of the European Banking
Authority, Enria was seen to be extremely well qualified for the job, and his
orthodox views on maintaining regulatory standards countered any potential fear
that he might be tempted to go easy on his own nation's banks, whose stock of
non-performing loans is one of the eurozone's biggest financial problems.
     Only the Italian government, in trouble with the EU for violating fiscal
rules, is understood to view Enria with suspicion.
     Similarly, Lane, widely respected as an economist, is regarded as the most
obviously competent replacement for Praet, with the same centrist, model-based
approach, the sources said. One of his possible rivals, Estonia's Ardo Hansson,
has been associated with more hawkish views.
     Praet's successor will be inherited by the next head of the ECB.
Frontrunners for that role, a highly political appointment, include De
Nederlandsche Bank President Klaas Knot, former Bank of Finland chief Erkki
Liikanen and still, despite an apparent decision by his own government to
prioritise a German candidature to head the European Commission, the
Bundesbank's Jens Weidmann. Francois Villeroy de Galhau, of the Banque de
France, is understood not to be campaigning but to be available if a call were
to come.
     Whoever replaces Praet, the ECB is eager to start the selection process
soon and have it approved well before the European Parliament elections in May,
thereby preventing it from being caught up in the subsequent political
horse-trading over the presidencies of the ECB, the European Commission and the
European Council.
--MNI London Bureau; +44 203 865 3829; email:
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