The search has begun for a replacement for Mark Carney, Bank of England (BoE) governor, who is due to leave his post in January 2020.
So far, the speculated names in the frame have included Andrew Bailey, the chief executive of the Financial Conduct Authority, seen as a “safe pair of hands”, Ben Broadbent, the Bank’s deputy governor for monetary policy and Andy Haldane, the Bank’s chief economist.
But also included have been Shriti Vadera, chair of Santander, Janet Yellen, former head of the US Federal Reserve, and Raghuram Rajan, economist, and former head of the Indian Central Bank.
Chancellor Philip Hammond has reportedly said that Mark Carney’s “steady hand has helped steer the UK economy through a challenging period”.
In the light of the ongoing turmoil that is a still-not-finalised Brexit, political populist turmoil and US-inspired trade wars with China and potentially the EU, clearly another “steady pair of hands” at the BoE is needed, as well as someone who may have to deal with a government that wishes to take back much of the power that was handed over by Gordon Brown when he was Chancellor.
Beyond a steady hand what qualities might SMEs like to see in a Bank of England governor?
The BoE headhunting will be carried out by Sapphire Partners, a head-hunting firm that specialises in diversity and placing women in top roles. The company is run by an all-female management team.
While they will obviously be seeking the best candidate for the job this could be an encouraging sign for many, given the various ongoing headlines about the difficulties women entrepreneurs have in being taken seriously and accessing finance as I have reported in past blogs.
At the time of Carney’s appointment in 2013 it was revealed that loans to SME fell by £4.4bn in the three spring months. Since then the signs have been that the main banks have continued their reluctance to lend to SMEs, so perhaps a signal of SME support from the new Bank of England Governor would be welcome.
To be fair, Carney and the Monetary Policy Committee have resisted the temptation to raise interest rates, which has been a huge benefit to many SMEs, particularly in the current turbulent economic climate. This has been welcomed by FSB (Federation of Small Businesses National Chairman) Mike Cherry.
In an interview published on the Government’s website in February this year, Mark Carney referred to the BoE’s upgrade of its RTGS [real-time gross settlement] system to take advantage of new technology to “not only lower the cost and increase the speed of payments, but has the potential to be transformative beyond the financial sector” and he said would benefit SMEs.
He also said “These benefits would multiply if delivered alongside services trade liberalisation, which has the potential to increase productivity growth, reduce excess imbalances, and make free trade work for all, including SMEs.”
So clearly he has been mindful of the considerations for SMEs, but what else would you like to see from the new Bank of England governor?
Leave your suggestions in the comments section below.