Bloomberg News

Carney Hiring Coup Will Bring New Thinking to BOE, Bean

November 28, 2012

Mark Carney will bring new and useful ideas to the Bank of England and his hiring was a “coup” for the U.K., said Charlie Bean, the deputy governor who will stay on to help in the transition from Mervyn King.

“I think when any new governor is going to come in, it’s always an opportunity for change,” Bean said in an interview yesterday. “With Mark, it will be somebody who will take the best of the bank we have at the moment that Mervyn and his forebears created, but I’m sure Mark will also bring new thoughts. Having run the Bank of Canada, he will have particular things he may think useful for us to import.”

Carney’s innovations as governor of Canada’s central bank included a promise in 2009 to keep the benchmark interest rate low for 15 months as long as the inflation outlook didn’t change, a measure followed by the Federal Reserve. His surprise hiring by Chancellor of the Exchequer George Osborne this week makes him the first foreigner to run the Bank of England. Bean agreed to extend his own term for a year to assist the handover.

Carney “is somebody who ticks all the boxes,” and his appointment is “a bit of a coup,” Bean, 59, said. As an ex- employee of Goldman Sachs Inc. (GS:US) “he’s very familiar with financial markets, and he was based in the City while working for Goldman so he knows the City well.”

Carney, 47, beat contenders including Bank of England Deputy Governor Paul Tucker, whose three-decade career at the institution marked him out as the leading candidate. He will be the first outsider to hold the post of governor since 1983.

Bean said there was a “good pool of candidates” to replace King as governor and “any of the people mentioned would have been able to do a good job.”

Testing Role

Carney’s skills will be tested as he takes over an institution that was shaped by King over the past decade and is now about to be given expanded powers. As well as guiding monetary policy, he’ll be at the forefront of regulation in a city whose status as the world’s leading financial center has been dented by trading scandals.

“He’s an extremely impressive individual, the times I’ve come across him at international meetings,” Bean said. “He can always be relied upon to make telling, insightful contributions, so I think he will be a really fantastic governor. Just the sort of person we need at the current juncture.”

Bean joined the Bank of England in 2000 as chief economist and became deputy governor in July 2008. He will stay in the post until June 2014, a year after his five-year term ends.

To contact the reporter on this story: Svenja O’Donnell in London at sodonnell@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net


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