King to stay as governor of the Bank of England

by Richard Kilner

Story link: King to stay as governor of the Bank of England

Today Mervyn King was reappointed as governor of the Bank of England, for a second term.

There had been some speculation that his tenure might come to an end, due to the Northern Rock crisis.

His reappointment means he will remain in post for the next five years.

Chancellor Alistair Darling has expressed his delight at the news, describing King’s experience and leadership as invaluable to the Bank of England.

It was unclear whether or not Prime Minister Gordon Brown, who made the Bank of England independent as Chancellor, would name a new man to take over the central bank’s reins.

King had been subject to some criticism following the management of the subprime-related credit crunch.

Last year Newcastle-based bank Northern Rock saw the first run on a British bank for over a century, an event that some blamed on King’s leadership.

In addition, the governor’s relationship with the government has not always been entirely cordial, with reports that he told a journalist the government was paralysed.

However, there is a broad consensus that King’s economic record is strong, with inflation almost always on target under his leadership and economic growth every quarter.