Economy, Business And Markets

Process to Select CBI Governor Modified

Process to Select  CBI Governor Modified
Process to Select  CBI Governor Modified

A new ruling by the Expediency Council has slightly modified the requirements for the appointment of new governors of the Central Bank of Iran, originally stipulated in a 1972 State Monetary and Banking Law.

The new approval by the Expediency Council requires the central bank governor to hold a Ph.D. in economics, monetary or banking disciplines. The governor should also carry at least 7 years of managerial experience in economic, monetary or financial areas and/or at least 5 years of specialized managerial experience in the central bank. No criminal records and popularity were among other criteria set for the selection of central bank governor candidates, Gholamreza Mesbahi Moghadam, a member of expediency council explained on Saturday, as reported by Fars news agency.

According to the recent modification, the minister of finance and economy shall nominate a candidate who shall be endorsed by cabinet ministers. The president shall then appoint the governor as per a presidential decree for a renewable period of 5 years. The same process will be applied to the cases of governor’s resignation or dismissal. The older version of State Monetary and Banking Law required the general assembly of the central bank to also approve the nominated candidate.

“The proposed 5-year-term in office envisaged for the governor of the central bank intends to help monetary policies which would further strengthen stabilization,” Mesbahi Moghadam added.

In this respect, “upon the assumption of office by a new government, the new president is allowed to change the governor if more than one year is left from his term in office,” he said. The change, however, should be “in light with defined mechanisms,” he added.

The draft approval will be submitted to the Leader for final approval, he said.