Alan Bollard has decided not to stand for another term when his current 5 year term expires on 25th September. Bollard was appointed in 2002 and has been at the helm of the RBNZ during the boom years up to 2007 and the subsequent financial crisis that followed.
It has been hinted that this will be a good time to introduce changes with regard the policy target agreement (currently 1-3%) and decision making within the Monetary Policy Committee. The OCR decision could be made by a voting committee rather than solely being the domain of the Governor. Also to introduce more prudent measures on the non-banking and insurance sectors.
Speculation on potential candidates to replace Dr Bollard include, internally; Deputy Governor and Head of Financial Stability, Grant Spencer; Assistant Governor and Head of Economics, Dr John McDermott. Possible external candidates include: Adrian Orr, a former Deputy Governor of the Reserve Bank, and current Chief Executive of the New Zealand Superannuation Fund; Rod Carr, a former Deputy Governor and acting Governor of the RBNZ, currently Vice Chancellor of Canterbury University; Murray Sherwin, also a former Deputy Governor of the RBNZ, and currently Chair of the Productivity Commission.
In a presentation in Christchurch last week, Bollard identified rising interest rates and the Canterbury rebuild as weighing on future monetary policy reviews, as rising bank funding costs push up retail rates independent of movements in the official cash rate. However, one can say that he has done a great job as Governor in very trying times.