What is ECB Executive Board and how is it appointed?
Juergen Stark will step down from the European Central Bank's Executive Board later this year, the central bank said on Friday. Sources told Reuters he was leaving because of a conflict over the central bank's policy of helping troubled euro zone debtor countries by buying their bonds.
Reuters German Deputy Finance Minister Joerg Asmussen will replace Stark, a source familiar with the plan said.
Here is a look at the job of Executive Board members and the appointment procedure for candidates:
ECB Executive Board
The six-member board is appointed by euro zone heads of government to run the central bank's day-to-day business. The board consists of the ECB President, Vice-President and four members.
They take operational decisions jointly and each member has responsibility for important functions of the central bank -- such as market operations, bank notes, payments and financial stability.
Board members also set the agenda of ECB meetings, prepare the economic analysis presented to the 23 Governing Council members and make an initial recommendation on the policy stance.
Members of the ECB's inaugural board were appointed in June 1998 to terms of differing lengths, stepping down between 2002 and 2006. All new appointees thereafter have eight-year terms, and they may serve only one term.
The expiry dates of members' terms are as follows. Trichet will be succeeded by Italian central bank head Mario Draghi.
- President Jean-Claude Trichet Oct 31 2011
- Vice-President Vitor Constancio May 31 2018
- Jose Manuel Gonzalez Paramo May 31 2012
- Lorenzo Bini Smaghi May 31 2013
- Juergen Stark May 31 2014
- Peter Praet May 31 2019
ECB Governing Council
The 23-member Governing Council is composed of the six Executive Board members and central bank governors from each of the 17 euro zone nations. The council sets interest rates for the euro area's roughly 321 million inhabitants. It meets twice a month, generally discussing interest rates only at its first meeting each month, reserving the second for other topics.
ECB General Council
Central bank chiefs from all 27 EU member countries meet quarterly along with the ECB Executive Board to discuss non-monetary issues relevant to them all -- such as exchange rates, economic statistics and banking.
Appointment Procedure for Executive Board Members
European Union finance ministers consider candidates nominated by EU governments and make their choice. The person must be "a person of recognized standing and professional experience in monetary or banking matters," according to the EU Treaty. The ECB is asked to comment on the candidate. The European Parliament is also consulted. It cross-examines the candidate at a public hearing in its Economic and Monetary Affairs Committee, then discusses the candidacy in a parliamentary plenary session. It has no power to veto an appointment. The Council of the European Union, at the level of heads of government and heads of state, then formally appoints the candidate. This can be done in a written procedure.
[Source: Reuters, Frankfurt, 09Sep11]
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