Profiling Mark Carney: the Newly-Crowned ‘King’ of the Bank of England

=Mark Carney will take over the reins at the Bank of England next year
Carney whilst Governor of the Bank of Canada

The new Governor of the Bank of England settles into his office on Threadneedle Street this week. Mark Carney arrives from his native Canada with a superb reputation behind him, and the label of one of the most important financial figures in the world economy. It is hoped that a fresh attitude to growth and a new dynamic at the Bank will rejuvenate the British economy and lead to a more prosperous decade, as figures suggest the worst of the financial crisis is well and truly in the past. However, can one man really make the huge difference that Britain needs him to? As journalist George Parker writes: ‘…some have argued the governorship represents systematic risk centred on one person…’. If we have learned anything from the financial meltdown of 2007-9, it is that the old systems need to be reformed to maintain a healthy and balanced economy. How Carney intends to tackle this issue – and limit his own stress levels – will mark his time in the post, currently discussed as one of the most important in British finance.

Central Line Service via Bank

Carney, the first non-British citizen to take the post of Governor, arrives in the City with wide experience of economics and finance. A graduate of Harvard University and both St. Peter’s College and Nuffield College, Oxford, the Canadian spent 13 years in various management and leadership roles at Goldman Sachs, before moving into the Canadian Department of Finance. Most recently, Carney was prominent in international economics as Deputy Governor and then Governor of the Bank of Canada, where he is credited with shielding the Canadian economy from the harshest winds of the global financial storm. Whilst Governor, he also became Chairman of the G20’s financial stability board. He begins the role at the Bank of England determined that he will only stay as Governor for five years, despite the term length being eight. The post is actually renewable, but only once.

Carney at the World Economic Forum
Carney at the World Economic Forum

Policy Forecasts

Ed Balls, in typical pragmatic fashion, has deemed the post of Governor of the Bank of England suitable only for ‘superhumans’. It is true, however, that there is a lot for Carney to do, and even more resting on his decisions. The Canadian is expected to tackle the Monetary Policy Committee (MPC) over the next month or so, before George Osborne’s deadline for the Bank of England’s stance on interest rates in August. The MPC was stubborn with Sir Mervyn King on quantitative easing (QE) and attitudes to growth; perhaps Carney will have more of an impact as the economy shows signs of recovery. His preference in Canada leaned towards low rates until growth picked up, to encourage cash flow through the economy – known as ‘forward guidance’. QE, according to Wigglesworth and Ross at the Financial Times, is also a valid route for Carney to pursue – government asset buying and weak Sterling would boost exports and revamp production in Britain.

Then there is the issue of how to handle the banks. It is essential to growth that lending, especially to small businesses, increases over the next five years – the government’s current ‘Funding for Lending’ program simply isn’t doing enough to encourage the distribution of loans. Carney, however, mustn’t compromise on increasing the stability and financial safety of Britain banking industry. How the new Governor goes about this matter will certainly be of distinct interest.

Reform and Refresh

Separately, the Bank of England itself requires some attention. Regardless of its policies, there have been problems within and without the institution in recent years that it is hoped will be neutralised by the arrival of such a successful banker. The appointment of two Deputy Governors over the next year will certainly shape any reforms that may be implemented, perhaps in the following areas: (a) culture – the archaic, hierarchical structure of the Bank could do with a shake-up; (b) transparency – the secretive nature of the institution suggests a lack of trust in the British public, which needs to be tackled one way or another; and (c) the Bank’s relationship with the City – King let this slip, but Carney comes to London as a respected financial diplomat capable of charming even the most hostile of bankers.


It seems that Carney’s term is destined to have an impact. His rhetoric and the discourse surrounding his appointment indicate intent to challenge the norms of the British banking system for the better. There will of course be tough decisions to make, including short-term policies on interest rates and growth strategies; but the financial media are generating a positive buzz around Carney. Perhaps it is the Canadian’s reputation. Perhaps the economy is excited for a new leader and fresh approach after the financial crisis. Either way, it won’t be long before Carney picks up the British economy by the tie and shakes it about to see what falls out from under the (white) collar, and what remains firmly intact.


Chris Giles, ‘New broom set to make a clean sweep’. Financial Time, July 1st 2013

George Parker, ‘Reality bites for Carney, bank’s new King’. Financial Times, July 1st 2013

Robin Wigglesworth and Alice Ross, ‘Investors and traders wait for their opportunity’. Financial Times, July 1st 2013


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