New era at Bank of England as Mark Carney begins reign

Mark Carney entered the Bank of England’s (BoE) offices on Threadneedle Street in London for the first time as governor this morning. He is tasked with leading the UK economy on a sustainable growth trajectory.

Replacing Sir Mervyn King, who occupied the role for a decade, Carney was previously governor of the Bank of Canada. Many say that it was because of his leadership that the Canadian economy rode through and recovered from the financial crisis better than most major financial centres.

The BoE revealed in November that Carney would be its next governor. The UK economy has shown signs of growth in recent months, but experts believe it may not return to pre-financial crisis levels until 2015 at the earliest.

Speaking about Carney’s first tasks, Robin Bew, chief economist at the Economist magazine’s Intelligence Unit, said, “He must get the UK economy growing robustly again, oversee further banking reform, and help the BoE to settle into a new supervisory role that aims to prevent future financial crises.”

Click here to read The Guide to Sustainable Banking 2012

The Financial Times reported on Sunday that investors and traders were in the process of debating the impact of Carney’s appointment. Many were expecting big changes in the first few months. Meanwhile, on the first day of his new job, the British Chamber of Commerce (BCC) urged Carney to boost lending to small businesses through a £1 billion investment bank.

In a recent report, the parliamentary commission on banking standards said bankers should be jailed for illegal activity. Chair Andrew Tyrie MP said, “Taxpayers and customers have lost out. The economy has suffered. The reputation of the financial sector has been gravely damaged. Trust in banking has fallen to a new low.”

It’s hoped that Carney’s appointment will go some way to reinstalling confidence in the mainstream banking sector. His wife, economist Diana who also runs a blog about ethical living called Eco Products That Work, has previously spoken out against what she called “rotten” banks.

Further reading:

Mark Carney must lead Bank of England down a sustainable path

Hades needed one three-headed watchdog; the City needs three separate ones

How renewable energy can help us beat inflation

Deputy Bank of England governor Paul Tucker to leave after 33 years

The Guide to Sustainable Banking 2012