REPEAT: MNI: Compromise ECB Names Circle Around Weidmann

Repeats Story Initially Transmitted at 17:45 GMT Apr 11/13:45 EST Apr 11

--No Formal Talks Yet, With Whole Range Of Appointments Seen Affecting Outcome

By Chris Mc Innes

     LONDON (MNI) - It is premature for any formal discussions to take place to

find the successor to Mario Draghi as ECB president when he steps down in

October 2019, though a handful of compromise candidates have surfaced should

frontrunner Jens Weidmann and his Bundesbank orthodoxy no longer fit when

decision-day arrives, MNI understands.

     Among the names circulating are alternative monetary policy hawk and

President of the Dutch central bank Klaas Knot, long-standing ECB Governing

Council member Erkki Liikanen, and increasingly-prominent Bank of France

Governor Francois Villeroy de Galhau.

     Significant variables -- aside from the usual heavyweight political

power-broking at the heart of the European Union -- are filling other top posts,

most notably the European Commission presidency, and the political and economic

conditions prevailing at the time the fourth guardian-in-chief of the single

currency is selected.

     Central to this will be the evolving state of the debate over Eurozone

structural and institutional reform designed to reinforce the resilience of the

single currency bloc against risks at home and abroad. 

     While the pace of reform is still seen as chiefly involving the two main

Eurozone heavyweights, France and Germany, the outlook is significantly clouded

by Chancellor Angela Merkel's weakened leadership and the prospects of Italy

being governed by an upstart populist and Eurosceptic coalition.

--BIG GENDER IMBALANCE

     Another important factor in the mix is the pressure the ECB shares with

public bodies generally to appoint more women. An awkwardness for Weidmann is

that his accession would lead to the departure of compatriot Sabine

Lautenschlaeger, currently the only woman on the six-person Executive Board and

one of only two women on the entire 25-strong Governing Council (with Bank of

Cyprus Governor Crystella Georghadji).

     Reports indicate that the ECB has been seeking to improve its gender

balance in top posts since 2013.

     Priority is expected to be given to identifying the successor to the chief

economist on the ECB Executive Board when Peter Praet's term ends in May 2019.

There is also the question of picking a successor to Daniele Nouy when she steps

down as head of the ECB's regulatory arm -- the Single Supervisory Mechanism --

on 1 January next year.

     MNI understands that formal talks to replace Draghi are not likely to begin

in earnest until the winter.

     In the race to succeed Praet as Chief Economist, respected Irish central

bank governor Philip Lane is seen as the frontrunner. Ireland is the only

founding member of the single currency that has yet to secure a seat on the

Executive Board. But the dearth of women has led to speculation that his deputy

in Dublin -- Sharon Donnery -- could pip him to the post.

     MNI cited German government and Eurosystem sources in a 1 March report

suggesting that Berlin's backing for two candidates from the Iberian peninsula

to secure the prime Eurozone positions of ECB vice president and Eurogroup head

would assist Weidmann's chances of succeeding Draghi. But the Eurosystem source

stressed that the manoeuvre does not mean that the Bundesbank president has the

ECB top job in the bag.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

--MNI Frankfurt Bureau; +49 69 97782671; email: frankfurt@marketnews.com