November 12, 2009 / 7:09 PM / 8 years ago

Bank of Canada deputy governor Longworth to retire

OTTAWA (Reuters) - The Bank of Canada will lose two of its most senior officials early next year, allowing Governor Mark Carney to bring in fresh blood just as he plots an exit from record-low interest rates as the economy recovers.

The central bank said on Thursday that Deputy Governor David Longworth, 57, will retire at the end of March 2010.

Two weeks ago Senior Deputy Governor Paul Jenkins said he would step down when his seven-year term ends in April 2010.

The bank said it will select a replacement for Longworth after finding a successor to Jenkins by February.

Longworth leaves the bank after a 35-year career at the institution. He joined in 1974 as a researcher and worked his way up the ranks until he was appointed advisor to the governor in 2000. He has held his current position since April 2003.

Longworth and deputy governor Pierre Duguay are the two deputies responsible for issues related to promoting a stable financial system.

“Most particularly, over the past two years David Longworth has made an outstanding contribution through his work, domestically and internationally, to restore stability to the financial system,” Carney said in a statement.

Carney is not officially on the recruitment committee but is expected to have a say in who gets hired.

Carney, a former Goldman Sachs banker, strayed from the traditional central bank career path by leaving the bank years ago to join the government’s finance ministry before returning as governor in February 2008.

He was something of a surprise appointment -- many Bay Street economists had expected that Jenkins would win the job.

Economists say Carney is likely looking at external candidates in the recruitment process that is now beginning to find a successor to Jenkins.

Tiff Macklem, the G7 sherpa at the finance department and former a deputy governor at the bank, is widely viewed as a leading candidate for the No. 2 job at the bank.

Under Carney’s leadership, the bank has cut its overnight rate to a historic low of 0.25 percent to provide stimulus to a recession-hit economy. The bank has pledged to keep the rate at that level until the end of June next year, provided inflation stays on track.

The six-member council that decides rates consists of Carney, Jenkins, Longworth, Duguay and two other deputy governors -- John Murray and Timothy Lane.

Reporting by Louise Egan; editing by Janet Guttsman

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