LONDON (Reuters) - Paul Tucker, a Bank of England deputy governor, was appointed on Monday to head a global rulemaking body for securities clearing, a sector at the heart of post-financial crisis reform.
Tucker will replace William Dudley, president and chief executive of the Federal Reserve Bank of New York, as chairman of the Committee on Payment and Settlement Systems (CPSS), made up of central bankers from the world’s leading economies (G20).
The committee is working with securities regulators to tighten rules for clearing house operators like LCH.Clearnet, ICE, CME and Deutsche Boerse.
Following the collapse of U.S. bank Lehman Brothers and near demise of U.S. insurer AIG during the financial crisis, regulators want as many derivatives contracts as possible centrally cleared to improve transparency and curb risks.
Tucker has spoken of the need for clearers to be well capitalised and have clear “death plans” to avoid “mayhem” or the assumption of a taxpayer bailout if they go bust.
He is seen by many commentators as the leading contender to replace Mervyn King as Bank of England governor next year.
Reporting by Huw Jones; Editing by David Cowell