May 15, 2015 / 3:56 PM / 3 years ago

EBRD head throws hat into ring for second term

TBILISI, May 15 (Reuters) - The head of the European Bank for Reconstruction and Development (EBRD), Suma Chakrabarti, fired the starting gun on Friday for what is likely to be a year-long race to become the bank’s next chief, signalling he would like a second term.

Chakrabarti’s current term runs until the middle of next year and the bank’s shareholders, which are dominated by G7 governments, are likely to vote on the position at the bank’s next annual meeting in a year’s time.

Speaking to reporters at this year’s meeting, Chakrabarti said it was too early to speculate, but made clear he would like to continue.

“We now have a five-year strategy, which has been agreed. I helped to design and lead this strategy,” he said.

“I would of course be very honoured and would like to see this strategy through over the next few years as President. But the matter of whether I get the second term is for the shareholders.”

The EBRD was set up in 1991 originally to invest in the former Soviet bloc countries of eastern Europe.

It has undergone an expansion in recent years to include Mongolia, Turkey, euro zone crisis countries Greece and Cyprus and the economies affected directly or indirectly by the Arab Spring uprisings, such as Morocco, Egypt, Tunisia and Jordan.

Chakrabarti, an India-born former British government official, is almost certain to face challengers for the role.

Traditionally, the post has been awarded to someone from France or Germany. The decision to elect Chakrabarti in 2012 therefore came as a surprise to many, and was part of a complex game of musical chairs for top European institution positions.

A number of countries from central and eastern Europe where the bank still does most of its work may also put up candidates.

Some at the bank argue it would be a strong signal for it to be run by someone whose own country has experienced the development process.

Chakrabarti’s term has been a difficult one for the bank. Last year it stopped lending in Russia, traditionally its biggest market, following Western sanctions against Moscow over its support of separatists in eastern Ukraine.

It also suffered its first annual loss since the financial crisis as the troubles slashed the value of its large Russian and Ukrainian portfolios. (Reporting by Marc Jones and Margarita Antidze; Editing by Mark Potter)

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