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23 May, 2024
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Who will lead Cyprus' Central Bank?

Decision on Central Bank Governor expected this week

Panayiotis Rougalas

Panayiotis Rougalas

An intense behind-the-scenes battle is unfolding regarding the future of Cyprus' central banker as the term of the current governor, Constantinos Herodotos, draws to a close in less than 20 days. President Christodoulides has yet to make a definitive decision, leaving all possibilities open — whether to extend Mr. Herodotus' term or to appoint a replacement.

Reports suggest that one of the parties supporting the government, namely the Democratic Party (DIKO), is in favor of Mr. Herodotus remaining in his role. Additionally, forces allied with former President Nicos Anastasiades also advocated for Herodotus' continuation, according to sources familiar with the matter.

Speculation surrounding Mr. Herodotus' fate is rampant in economic and political circles. While some rumors suggest that President Christodoulides has signaled to Mr. Herodotus that his term will not be renewed, others claim that the president has indicated to former Bank of Cyprus deputy CEO Christodoulos (Christakis) Patsalides that he is being considered for the position. However, no official confirmation has been provided regarding Mr. Patsalides' potential appointment.

It appears that President Christodoulides may harbor reservations about Mr. Herodotus' tenure despite potential satisfaction with his performance, as he reportedly has a preference for Mr. Patsalides. Mr. Patsalides, a seasoned banker, has been a close advisor to President Christodoulides on economic matters since the president's election. His extensive experience includes senior roles in Cyprus' largest bank and chairmanship of the Cyprus Bankers Association.

The upcoming decision, expected imminently, underscores the political significance attached to the position of Cyprus' central banker. While Mr. Herodotus' five-year tenure has not been subject to major criticism, President Christodoulides may be inclined toward a change. Conversely, Mr. Patsalides' familiarity with the banking landscape in Cyprus and Europe, coupled with his substantial professional background, positions him as a viable candidate for the role.

Christodoulides' preference for Mr. Patsalides could signal a shift in leadership at the Central Bank, potentially marking a significant transition in Cyprus' financial governance. However, until an official announcement is made, uncertainty looms over the future direction of the country's monetary policy.

[This article was translated from its Greek original and edited for clarity and brevity]

Cyprus  |  economy  |  bank

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