FRANKFURT â€" The governing council of the European Central Bank on Wednesday nominated Danièle Nouy as head of the new central bank regulator for the euro zone. With the move, the council fills one of the most prominent job openings in Europe while answering criticism that it has no women in senior leadership positions.
If approved, Ms. Nouy would head the new so-called Single Supervisor. The new entity, which will be a part of the E.C.B., is designed to address one of the major flaws in the design of the euro zone: the lack of a unified banking system with common regulations and a central overseer.
Ms. Nouy, born in 1950, is a veteran bank regulator who has spent her entire career at the Bank of France, the French central bank, where she is secretary general of the Prudential Supervision and Resolution Authority. She had been considered a top contender for the E.C.B. job because of her experience and because the E.C.B. is looking to promote women to top posts. Ms. Nouy has been a member of as well as a senior official at the Basel Committee on Banking Supervision, the body that establishes global standards for bank regulation.
All 23 members of the E.C.B. governing council, which nominated Ms. Nouy after a meeting in Frankfurt Wednesday, are men. Her appointment as Europe’s highest-ranking bank supervisor must still be approved by the European Parliament.
The failure of European political leaders to clean up the banking system is a reason that the euro zone economy remains stagnant. Many banks have trouble raising money on the open market because of doubts about their health. As a result they are short of funds to lend to consumers and businesses, creating a severe credit crunch in countries like Italy.
The E.C.B. is embarking on a thorough review of the largest banks in the euro zone to determine which have serious problems and to force them to take corrective measures. The review is supposed to be completed in a year, even though the E.C.B. has only begun to hire staff for the new supervisor. The Single Supervisor is scheduled to legally acquire authority over banks at the end of next year.
Five years after the collapse of Lehman Brothers, many European banks remain undercapitalized and burdened with bad loans in part because national supervisors have lacked the will or the expertise to get them to address their problems.
Ms. Nouy’s nomination is likely to please Germany, which has generally been in harmony with France on bank regulation issues. But the two countries have faced criticism for being overly protective of their banks and opposing regulations that would curtail banks’ use of borrowed money to do business.
