World’s Longest-Serving Central Bank Chief to Get New Term in Romania

(Bloomberg) -- Romania’s Mugur Isarescu, the world’s longest-serving central bank governor, is poised to be confirmed for a new five-year term as lawmakers seek a vote on the extension by the end of June.

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Isarescu took over the leadership of the National Bank of Romania in 1990, less than a year after the collapse of Nicolae Ceausescu’s communist regime, and has served for over three decades except for a yearlong stint as prime minister in 1999 and 2000.

The 74-year-old has the backing of the largest parties in parliament to stay on for another term, according to people familiar with the discussion who asked not to be identified as deliberations weren’t public. The vote on Romania’s nine-member rate-setting panel will take place after local and European Parliament elections on June 9, they said.

Isarescu stopped short of confirming his candidacy for an eighth term earlier this month, though said he’d accept an invitation should parliament back him. The governor has been grappling with the highest inflation in the European Union. He’s dialed back expectations of rapid interest-rate cuts, urging the government to rein in a budget deficit forecast at 5% of economic output this year.

Policymakers in Bucharest unexpectedly held the benchmark interest rate at 7% on May 13, defying expectations among most economists surveyed for a 25 basis-point cut.

As part of the parliamentary vote on the panel, Deputy Governor Leonardo Badea is likely to take over the first-deputy role from Florin Georgescu, who will remain on the board, according to those familiar. Ionut Dumitru, chief economist for Raiffeisen Bank Romania and a former head of the fiscal council, has the support for a deputy governor post, replacing Eugen Nicolaescu, they said.

Some of the existing board members, such as Cristian Popa and Csaba Balint, will likely also have their mandates renewed, while presidential adviser Cosmin Marinescu may also join the team, the people said.

Opposition lawmaker Claudiu Nasui confirmed that the vote will take place by the end of June — and his USR party will support Popa for a new term on the central bank’s board.

A spokesman for the central bank declined to comment.

(Updates with lawmaker comment in eighth paragraph. A previous version corrected to clarify Dumitru is currently chief economist.)

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