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UPDATE 1-Bank of Spain governor to be named on Thursday
June 5, 2012 / 6:02 PM / 5 years ago

UPDATE 1-Bank of Spain governor to be named on Thursday

(Adds details, sources)

MADRID, June 5 (Reuters) - Spain is set to name its new central bank governor on Thursday with former ECB board member Jose Manuel Gonzalez-Paramo and Luis Maria Linde, a former general director at the Bank of Spain, seen as joint favourites for the job.

Spanish Economy Minister Luis de Guindos is due to announce on Thursday who will take over from Miguel Angel Fernandez Ordonez on June 11, a source with knowledge of the matter said, and will be hoping the new chief can restore the bank’s damaged credibility.

Another source briefed On the issue said that Fernando Becker, head of corporate resources at the Spanish energy group Iberdrola, was also seen as a possible candidate but another source said Becker’s close ties to Prime Minister Mariano Rajoy could put him at a disadvantage.

The central bank has seen its reputation diminished in recent weeks as the government has sought to blame it for failing to recognise the full scale of toxic assets on bank balance sheets.

Ordonez said last month he would step down on June 10, a month before the end of his six-year term, after government officials heaped blame on him for the rising cost of bailing out troubled banks.

A high-level Spanish banker and a prominent foreign investment banker in Spain both said the strongest candidate is Jose Manuel Gonzalez-Paramo, the former Spanish board member at the European Central Bank, who left at the end of May.

In late May the government named Linde to the central bank’s board, generating speculation that he could be Rajoy’s preferred candidate for the governorship.

However, under the bank’s statutes he would have to retire in three years when he turns 70, and would not be able to complete a six-year term. (Reporting by Julien Toyer and Andres Gonzalez; Editing by Nigel Davies and Susan Fenton)

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