Greece’s former Finance Minister Yannis Stournaras on June 11 was appointed Governor of the Bank of Greece for the next six years, taking over from George Provopoulos, who had wanted to keep the job.
“It is announced that the General Council of the Bank of Greece, in view of the departure of Governor George Provopoulos after the expiry of his term on June 19, 2014, unanimously decided in a meeting today to recommend to the cabinet the appointment of Yannis Stournaras to the post of governor,” the Bank of Greece said in a statement.
In a few days the National Bank’s deputy governor, Louri Dendrinou, also completes term of office and according to Vimatodotis, Stournaras has asked for Anastasia Sakellariou to be appointed new Deputy Governor.
Prime Minister Antonis Samaras, who made the change, called Provopoulos and thanked him for his services, especially during an ongoing financial crisis that the former bank chief was going to end sooner than it did, putting a rosy spin on the country’s fiscal problems
Provopoulos, 63, had supervised the recapitalization of the Greek banking system under the terms of the country’s international bailout and had publicly said that he wanted a second term.
He was replaced at the ministry by Gikas Hardouvelis, chief economist at Eurobank and a university professor.
Stournaras, 57, will take over from George Provopoulos when the Governor’s term ends on June 19. Stournaras’ appointment means he will be a member of the European Central Bank’s Governing Council.
Stournaras is an economist, a former CEO of a commercial Greek bank, headed Greece’s influential think-tank IOBE, and was a government economic adviser when Greece joined the Eurozone.
Under the hard-nosed Stournaras, Greece attained a 1.5 billion euro primary surplus and has come to where a recovery could take place later this year, although the IMF warned the country’s still staggering 315 billion euros ($430 billion) debt, which is 175 percent of Gross Domestic Product (GDP) will linger into the next decade.
Greece also returned to bond markets in April after a four-year exile with a successful sale of 3 billion euros of bonds and reached the critical primary surplus which is a trigger for asking for debt relief from the Troika, which could be a restructuring or even a so-called “haircut,” in which Greece wouldn’t have to repay all that it owes.
Greece’s main opposition,the Coalition of the Radical Left (SYRIZA) said it opposed Stournarass appointment because he was a proponent of the big pay cuts, tax hikes, slashed pensions and worker firings the party rejected.
“Mr. Stournaras will continue to defend the bailout policies from his new post,” SYRIZA spokesman Panos Skourletis was quoted as saying by Greek news website skai.gr.
SYRIZA leader Alexis Tsipras – emboldened by the party’s victory in European Parliament elections in Greece last month – had warned Samaras not to appoint a new governor without consulting him.
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