Andrew Kriegler, who helped steer Canadian Imperial Bank of Commerce through the 2008 financial crisis, is a leading candidate to succeed Julie Dickson as Canada’s top banking regulator, said a person familiar with the process.
Kriegler, currently deputy superintendent of the supervision sector at the Office of the Superintendent of Financial Institutions, is being considered to replace Dickson when she leaves June 28 after seven years in the role, the person said on condition of anonymity because the process isn’t public. The person didn’t say who else is being considered, or how many names are on a list of candidates.
The superintendent appointment will mark the latest change among the group that shepherded the world’s 11th largest economy through the global financial crisis with less upheaval than most industrialized nations. In the past year, three of the country’s six biggest banks have new or incoming chief executive officers, and Canadian Imperial said its top executive will retire within two years. Central banker Mark Carney and finance minister Jim Flaherty left during that period, replaced by Stephen Poloz and Joe Oliver, respectively.
“There’s a changing of the guard, clearly,” said Janet Ecker, CEO of the Toronto Financial Services Alliance, a group of business and government representatives who promote the industry in Canada’s largest city. “What will be critical for the industry is, can the culture that has helped build the success story continue under the new leadership?,” Ecker said in a June 6 telephone interview.
Kriegler, who has been with the Ottawa-based agency for about 16 months, has more than 25 years experience in the financial services industry, including serving as treasurer at Canadian Imperial through the financial crisis. He was part of the turnaround team set up in 2008 by the Toronto-based lender.
Telephone and e-mail messages left with Kriegler weren’t immediately returned. Brock Kruger, a spokesman with OSFI, declined to comment on whether Kriegler, 50, is a candidate. Kruger did say that Deputy Superintendent Mark Zelmer, 53, didn’t apply for the top job.
Oliver said in a May 27 press conference in Ottawa that he’s looking for someone with a “profound” understanding of the financial sector who has a lot of experience, sound judgment and balanced approach to regulation, to replace Dickson. The announcement should come soon, he said.
“We’ve had an extensive recruitment process,” Oliver said. “We’ve spoken to quite a number of highly qualified people.”
The superintendent reports directly to the Minister of Finance, so it’s highly likely that Oliver will be closely involved in choosing Dickson’s successor, Anita Anand, a law professor at the University of Toronto, said by e-mail.
“OSFI has well-qualified individuals within its own ranks from whom to choose, but as we saw with the appointment of the Governor of the Bank of Canada last year, the candidate may well be someone external to the institution,” Anand said.
The government will face “a lot of pressure” to make sure they get the right person, Koker Christensen, a lawyer at Fasken Martineau who specializes in regulation of financial institutions, said in a May 28 phone interview. “If you look at the people who have senior roles in OSFI they don’t all have the same background.”
“It’s also possible there would be someone on an interim basis like Julie Dickson was,” Christensen said. “From the government’s perspective this is a very important appointment.”
Dickson was appointed superintendent in June 2007, about eight years after she joined the regulator. Before the top job, she served in the interim role of acting superintendent from October 2006 and as deputy superintendent for about four months before that. She was assistant superintendent of regulation sector from January 2000 to June 2006.
“Julie Dickson was very influential and very constructive in the global dialog, and that’s what we’d expect from her successor,” Bank of Montreal CEO William Downe said in a May 28 telephone interview.
Kriegler joined Canadian Imperial after CEO Gerald McCaughey redoubled efforts to “de-risk” the bank starting in January 2008. The bank had more than C$10 billion ($9.2 billion) of losses and writedowns from bad bets on U.S. debt securities during the financial crisis, more than any other Canadian lender.
McCaughey ousted his top investment banker and chief risk officer at the time, and followed up by selling most of its New York-based investment bank and exited risky businesses such as European leveraged finance while scaling back on debt securities that got the bank into trouble.
Kriegler previously spent eight years at Moody’s Investors Service, including six years as a managing director in Canada. His prior experience includes working at CIBC, Bank of Montreal’s Nesbitt Burns unit and Canada Trust, in areas such as securitization and funding, according to biographical details on OSFI’s website.
Kriegler has an master’s degree in business administration from the University of Western Ontario and a Bachelor of Science in economics and computer science from Trinity College, University of Toronto.
“Andrew’s got experience in Canadian capital markets and with CIBC,” Ian Russell, CEO of the Investment Industry Association of Canada, which represents the country’s securities firms. “He certainly brings a lot of talent to the table, no question.”
Canada’s banking regulator, under Dickson, has made sure that the country’s financial-services firms are ahead of schedule in implementing new global standards for regulations including capital ratios and leverage targets.
During Dickson’s tenure, Canadian banks sidestepped the worst of the financial crisis, recording less than 2.2 percent of the $2.09 trillion of writedowns and credit losses recorded by global financial firms over a three-year period, according data compiled by Bloomberg. Canada’s financial system has been ranked the world’s soundest for six consecutive years by the Geneva-based World Economic Forum.
“Since the financial crisis the Canadian banks really became the envy of the world, the safest and soundest banking system,” Toronto-Dominion Bank Chief Financial Officer Colleen Johnston said in a May 22 interview. “I would say that the Canadian banks and the regulators and the finance minister and all the powers that be would like to keep it that way.”