Nowotny Wins 2nd Term as Austrian Central Bank Governor

Ewald Nowotny, who has led Austria’s central bank since the financial crisis erupted in 2008, was appointed for a new six-year term.

Nowotny, 68, has promised to serve the full term if his health allows, Austrian Finance Minister Maria Fekter told journalists in Vienna on her way into the government meeting that confirmed the appointment for the four-member board. As governor, he will be the third-oldest member of the European Central Bank’s rate-setting Governing Council, after Slovenian Governor Marko Kranjec and ECB Vice President Vitor Constancio. Nowotny’s term starts Sept. 1.

“I am very happy with the competency of the individuals concerned,” Fekter said of the central bank appointments. “We have a good mix of people that have economic knowledge, that have supervision knowledge, and who have years of experience” in the bank and in international bodies, she said.

Nowotny, who succeeded Klaus Liebscher at the head of the Austrian central bank in September 2008, just days before Lehman Brothers Holdings Inc. collapsed, was in parliament for Austria’s center-left Social Democrats and has an academic track record entrenched in Keynesian economics. He has taught in Harvard, Darmstadt and Vienna and -- as its chief executive officer -- helped rescue the Austrian trade union’s ailing Bawag bank in 2006. Since taking on his role as governor, he has backed Germany’s pressure for fiscal austerity, while betraying traces of Keynesianism only in advocacy for more lenient monetary policy.

He has been one of the most talkative policy makers during the crisis, earning him monikers including Handelsblatt’s “The Omnipresent” and criticism from some of his peers.

The government also reappointed Andreas Ittner, the central bank director now responsible for banking supervision, for a six-year term. It named Peter Mooslechner, currently the head of the central bank’s economics department, and Kurt Pribil, co-president of the Finanzmarktaufsicht watchdog, as new directors. They replace Peter Zoellner, who was named new head of the Bank for International Settlement’s banking department yesterday, and Wolfgang Duchatczek.

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