Germany will nominate a candidate to succeed the European Central Bank’s departing executive board member Isabel Schnabel, signalling that it will not seek the presidency of the monetary authority.
German finance minister Lars Klingbeil told counterparts from other Eurozone countries in Luxembourg on Thursday night that Berlin would soon propose a candidate for Schnabel’s job, which will become vacant in January, two people familiar with the matter said.
A replacement for Schnabel is one of the three top ECB roles that Eurozone capitals are expected to agree by the end of the year as part of a “grand package”, which will also involve negotiating a successor for its president, Christine Lagarde.
Lagarde is widely expected to leave before the end of her eight-year term, which expires in October 2027, while chief economist Philip Lane will leave at the end of May.
Due to unwritten rules that imply that no country can have two representatives on the ECB’s six-member executive board, a German successor for Schnabel in effect eliminates a German candidate for the top job. Germany has never held the presidency of the Frankfurt-based institution.
Bundesbank governor Joachim Nagel and Schnabel had both last year signalled that they would be prepared to succeed France’s Lagarde. Schnabel announced last month that she would leave her post at the ECB early to head the IMF’s powerful monetary and capital markets department.
When asked by journalists on Friday about his comments, Klingbeil said that Germany “will attach great importance to continuing to be strongly represented in the ECB’s leadership bodies”, adding: “We will soon put forward a candidate for that.”
Klingbeil’s plan to propose a successor for Schnabel also suggests that Germany has given up on the idea of securing the chief economist role at the ECB — widely seen as the second most important job after the president.
The chief economist oversees the institution’s large monetary policy team and is the mastermind behind the central bank’s decisions. France has already signalled that it is seeking that position, according to people familiar with the matter.
Should Germany keep Schnabel’s markets portfolio at the ECB while France secures the successor for Lane, this could also raise the odds of former Dutch central bank president Klaas Knot becoming the next president. His main rival for the job, Bank for International Settlements boss Pablo Hernández de Cos, is Spanish. German Chancellor Friedrich Merz met Knot on Thursday and is also due to meet Hernández de Cos.
Germany and other northern Eurozone countries would be unlikely to tolerate a Spanish ECB president alongside a French chief economist, according to people familiar with the matter.
Germany’s plan to endorse a successor to Schnabel was first reported by Bloomberg.