Israel's Fischer says will stay on as cenbank head

JERUSALEM Tue Jun 14, 2011 8:50am BST

Israel's central bank governor Stanley Fischer visits the Finance Ministry in Tokyo in this February 7, 2007 file photo. REUTERS/Toshiyuki Aizawa/Files

Israel's central bank governor Stanley Fischer visits the Finance Ministry in Tokyo in this February 7, 2007 file photo.

Credit: Reuters/Toshiyuki Aizawa/Files

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JERUSALEM (Reuters) - Israel's Stanley Fischer said on Tuesday he regretted a decision by the International Monetary Fund board to rule him out of the IMF top job because he was too old and said he would "happily" stay on as central bank chief.

"I think that the age restriction, which was set in the past at 65, is not relevant today. I was hoping the IMF board of directors would change its regulations, not only for the sake of my candidacy, but also for the sake of future candidates for the position of managing director," Fischer, 67, said in a statement.

An IMF board statement on Monday said it had shortlisted French Finance Minister Christine Lagarde, seen as the favourite for the job, and Mexico's central bank chief Agustin Carstens. It made no mention of Fischer.

The 24-member board rejected changing the IMF's rules that would have allowed Fischer to run, two board officials told Reuters.

The officials said changing the rules for Fischer, who is highly respected by both advanced and emerging economies, would have required a reopening of the selection process to allow other candidates older than 65 to participate in the race.

The IMF statement added that it planned to complete the selection process by June 30.

A former World Bank chief economist and ex-vice chairman of Citigroup, Fischer, who holds American and Israeli passports, announced his last-minute candidacy at the weekend, saying he had been encouraged to enter by a number of governments.

Fischer was deputy managing director of the IMF from 1994 to 2001 and was a key figure in the IMF's Mexican bailout after the peso crashed in the mid 1990s.

Fischer added: "I have no regrets for having submitted my candidacy. I do regret the fact that I was not given the opportunity to demonstrate my capabilities and my experience to the IMF board of directors."

Fischer, who was born in what is now Zambia, added in the statement that he would be happy to continue his position as governor of the Bank of Israel.

"I will proudly and happily continue in my role as governor of the Bank of Israel, to deal with the challenges facing the Bank of Israel and the Israeli economy," he said.

Israeli Finance Minister Yuval Steinitz had said Fischer had little chance of winning the race, citing political obstacles as well as the age issue.

Fischer said he was thankful for the support of Israeli Prime Minister Benjamin Netanyahu and Steinitz after he announced his candidacy.

"I would like to thank the prime minister and the minister of finance for their unconditional support when I decided to submit my candidacy, and for their expressed hope that I will continue to serve as the governor of the Bank of Israel -- as I shall happily do," he added.

(Editing by Tova Cohen and Ramya Venugopal)

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