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Canada's Mark Carney Appointed As Next Bank Of England Governor

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Mark Carney, the head of Canada's central bank, who once said he was willing to blow the whistle on big financial institutions, has been appointed the next governor of the Bank of England.

Carney's appointment, which will see him earn £624,000 a year for five years (more than twice the amount Sir Mervyn King is paid) came as a surprise to many in the City, many of whom had plumped for the current deputy governor Paul Tucker.

Such was the expectation that several betting shops had stopped accepting bets on Tucker to take the role.

Carney, who worked at Goldman Sachs for 13 years prior to his position at the Bank of Canada, is seen as a hardliner - and told the BBC in August that he was willing to blow the whistle on banks that break international norms or don't comply with reforms designed to prevent a repeat of the 2008 financial crisis.

"One of the things we're doing as international regulators... is not just designing rules but we're auditing the countries from the U.K. to Canada to China to see whether they're actually implementing these new rules," he said, speaking in his dual role of head of the Swiss-based Financial Stability Board.

"And if they don't, we're going straight to the top. We're going to the leaders of the G20, and we're going to the media and the general public, and we're letting people know who's on track and who's lagging behind."

Carney moved on to say he believed financial institutions are complying so far with the new capital requirements and that the world is "moving in the right direction to ensure ending the problem of 'Too Big to Fail' " banks so that taxpayers need not be forced to bail them out.

Interestingly, he refused to be drawn on the Libor rate rigging scandal when asked, and offered instead: "These are big, complex banks, they deal with a range of countries and a range of types of transactions, and the senior executives have to be on top of all of that. And if they can't be on top of all of that, they need to shed businesses and activities."

Amusingly, Carney also told the BBC in August that he was looking forward to working with the next Bank of England governor, but that it wouldn't be him.

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The failure of Tucker to be appointed was not entirely a surprise however, as he had suffered in the early days of the open application process, after stories about the "matey" emails between Tucker and former Barclays chief Bob Diamond over the Libor rigging.

Diamond said Tucker had told him in a phone conversation that "senior figures within Whitehall" were concerned that Barclays' Libor rates were higher than some of the other main banks, although he denied that Tucker was explicitly asking him to lower Libor - Barclays later lowered its Libor rates.

It is believed the announcement has been made today - seven months before Carney will ascend to the role - in order to provide a semblance of stability in the run up to chancellor George Osborne's Autumn Statement, due on 5 December.

Several media reports have questioned whether Tucker will remain in the role of deputy for a further five years, with some suggesting a move to the private sector may be on the cards.

Other candidates for the role included Lord Adair Turner - Financial Services Authority chairman. Many in the city were suspicious of him however; Turner was frequently described as a turncoat, having been a Tory, then SDP, then a fan of Blair.

His role as chairman of the FSA at a time of economic crisis was also put in the spotlight, and MPs on the Treasury Select Committee for banking standards heavily criticised Turner personally for his handling of the RBS/ABN Amro sale.

Sir John Vickers, former Office of Fair Trading boss, was also lined up as a possible replacement for King, after he led the government's review into breaking up the banks.

In addition, Andrew Haldane, executive director for financial stability at the Bank of England, former cabinet secretary Lord Gus O’Donnell and former group chief executive of Barclays John Varley were all in the frame for the role.

Liberal Democrat MEP Sharon Bowles was the only female candidate in the line up. While she was always considered an outsider, media interest was piqued by the idea of the first woman governor for the Bank of England - known as the Old Lady by the City - in its 318-year history.

Carney will take up the role when the current Bank of England governor, Sir Mervyn King, steps down in June 2013.

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