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Raghuram Rajan top contender in race to lead 325-year-old Bank of England

BusinessToday.In     June 12, 2019

Former RBI Governor Raghuram Rajan is among the top contenders for the high-profile Bank of England governor's job, suggest reports. Many suggest Rajan, particularly due to his empathy for the United Kingdom's dilemma over Brexit, is a perfect fit for the top job at the 325-year-old institution. The overall profile of Rajan, who's a professor at the Chicago Booth School of Business and has served at one of the top institutions across the world, also makes him a suitable choice among the front-runners.

Rajan, 56, had worked as chief economist of the International Monetary Fund for the three years between 2003 and 2006, following which he worked as an advisor to the Indian government. He worked as the Reserve Bank of India Governor for three years from 2010 to 2013. During his tenure as the RBI governor, he was instrumental in controlling inflation after introducing the target system. He also initiated the process to clean up stressed assets in the banking system.

His rise to fame is believed to be his prediction at the prestigious annual Jackson Hole gathering in 2005 where he warned of possible global risks in the financial system -- three years later the global recession started in the US, leading to the collapse of major banks like Lehman Brothers.

The appointment at Bank of England will be made by Chancellor of the Exchequer Philip Hammond around October this year. After extending his term twice, the Treasury is sure that Mark Carney will stand down as the Bank of England Governor in January 2020.

Andrew Bailey, the chief executive of the Financial Conduct Authority, is another favourite contender for the top job, but his odds are drifting out a little, suggest reports. Notably, Rajan is not the only Indian in the race. Shristi Vadera, the chairperson of Santander UK, is also among the six probable replacements for Carney despite no experience with central banks. She, however, is known for her work as a no-nonsense minister in the Gordon Brown government.

Edited by Manoj Sharma

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