How Estonia appoints its central bank Governor?

Central banks appoint their Governors and Deputy Governors in multiple ways. There is no one standard way.

Came across this Press release by Estonia Central Bank (called Eesti Pank) where secret ballot is used to select the Governor:

In a secret ballot at its meeting on Tuesday the Supervisory Board of Eesti Pank elected Madis Müller as candidate for the position of Governor of the central bank.

The candidates for the post were Robert Kitt, Madis Müller and Märten Ross. The Governor of Eesti Pank is also a member of the Governing Council of the European Central Bank.

At the start of the meeting the three candidates gave a presentation to the board and answered questions and there followed a thorough and in-depth discussion.

“I would like to thank the members of the Supervisory Board who introduced the three excellent candidates for a position that has influence over the everyday life of people across Estonia and the whole of the European Union. Decisions are taken at the Governing Council of the European Central Bank that can affect matters like the speed of economic growth across the whole euro area, or how much people must pay for their housing loans. It is my job to make sure that such an important position for the Estonian state is filled in a reasoned and transparent way”, said Supervisory Board Chair Mart Laar.

Having received the backing of the Supervisory Board, Madis Müller must now undergo background security checks by the Estonian Internal Security Service for three months. After the security checks have been completed, the data will be presented to the Supervisory Board, which may then propose to the President of the Republic that Madis Müller be appointed Governor of Eesti Pank.

The final day of office of the present Governor Ardo Hansson will be 6 June. The law allows the Governor of Eesti Pank to be appointed to office for a term of seven years and only for one term.

Mr Müller has been a Deputy Governor of Eesti Pank since 2011, prior to which he worked in 2006–2011 for International Finance Corporation (IFC) as a portfolio manager making equity investments. In 2003–2006 he was an advisor and senior advisor to the managing director of the Nordic-Baltic constituency of the World Bank, and he earlier worked as economic advisor and consultant to the Prime Minister and the Minister of Finance. He has been a Member of the Supervisory Board of the European Central Bank for SSM/Banking Supervision since 2014. Since 2011 he has represented Eesti Pank in various international forums, including the Economic and Financial Committee of the Council of the European Union, the High Level Group on Market Infrastructures of the European Central Bank, the Euro Payments Council, the Nordic-Baltic Monetary and Financial Committee at the IMF and others.

Mr Müller holds a Masters in Finance from George Washington University in the USA, which he received in 2006, and he graduated in international business management, banking and finance from Estonian Business School in 1999. He has a global Financial Risk Manager (FRM) licence and a Chartered Financial Analyst (CFA) licence.

The Supervisory Board named Robert Kitt, Madis Müller and Märten Ross as the three candidates for the position of central bank Governor at the end of January. Only members of the Supervisory Board may nominate candidates for the position of Governor.

Here the Board appoints the candidates as we see in Canada and Sweden as well. Though, the transparency in Estonia’s case looks really high…

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