DUBLIN (Reuters) - Ireland appointed New Zealand treasury chief Gabriel Makhlouf as its new central bank governor on Wednesday, replacing Philip Lane who leaves next month to become the European Central Bank’s chief economist.
A former senior civil servant in Britain, where he served as principal private secretary to then finance minister Gordon Brown and held leading roles with the UK tax authority, Makhlouf will take charge on Sept. 1, Ireland’s finance ministry said.
In his new role he will also sit on the Governing Council of the ECB, the first time Ireland will have two rate-setters. A temporary governor will be named by Ireland’s Central Bank Commission to cover the three-month period following Lane’s departure for the ECB’s executive board.
“I am delighted to nominate a person of Gabriel Makhlouf’s international caliber,” Finance Minister Paschal Donohoe said in a statement.
“Gabriel has demonstrated his broad and detailed knowledge, of economics, financial markets, monetary policy, and fiscal policy, and has the experience of leading a large and complex public service organization of 10,000 people.”
The son of United Nations diplomats, Makhlouf was born in Cairo of British and Greek parentage and has a degree in economics from Britain’s University of Exeter.
He became head of the New Zealand treasury in 2011, where he has also been the government’s chief economic and financial advisor. In New Zealand, he played a leading role in the government’s public and private sector diversity and inclusion drive and was recently named an observer on the Reserve Bank of New Zealand’s newly-formed Monetary Policy Committee.
Makhlouf, 58, becomes the first non-Irish national to lead the central bank after emerging from a shortlist that included one of Lane’s two deputies, Sharon Donnery, who narrowly lost out in the race to head the ECB’s supervisory arm last year.
Had Donnery been appointed, she would have become the first woman to lead the bank and helped address a lack of women at the top of the ECB for which the euro zone’s central bank has been sharply criticized.
The ECB, which now has only one woman on its 25-member Governing Council, is undergoing major personnel changes this year, including the naming of a successor to President Mario Draghi and Lane’s appointment as Chief Economist.
In Ireland, Makhlouf takes on an economy that has been the best performing in Europe since 2014. It is seen at risk of overheating if the recent pace of growth continues, but could face a different challenge if neighboring Britain ends up leaving the European Union without a deal to smooth transition.
The central bank’s supervisory capabilities will also be tested during his seven-year term after more than 100 financial services firms applied to the bank to set up or extend operations in Ireland as a result of Brexit. A homemade banking crisis drove Ireland to the brink of bankruptcy a decade ago.
Editing by Catherine Evans and Frances Kerry
Our Standards: The Thomson Reuters Trust Principles.