Search is on for new Bank Governor

THE race is on to find a successor to Sir Edward George as Governor of the Bank of England and the candidates have been whittled down to three.

Government officials have indicated that the contestants in the running to take over from Sir Edward when he steps down in June next year are Mervyn King, Deputy Governor in charge of monetary policy policy at the Bank, Sir Howard Davies, executive chairman of the Financial Services Authority, and Andrew Crockett, general manager of the Bank for International Settlements in Basle, Switzerland.

A respected academic, and highly regarded in international financial circles, King, 54, is believed by many in the City to be the only man for the job. City bookmakers Cantor Index recently rated his chances 9-2 on.

He has been professor of economics at Harvard, Massachusetts Institute of Technology and the London School of Economics, as well as being chief economist at the Bank. The main asset he would bring to the job is that of a first-rate economist, a qualification that has become much more important since the Bank was given the power to set interest rates.

He has also shown himself capable of employing the common touch in conveying the Bank's message, famously explaining that inflation figures were often volatile and erratic, and could be likened to disco dancing. 'It will not be easy to see the underlying trend across the crowded dance floor,' he said.

King's biggest obstacle is his perceived euro-scepticism, especially if the appointment coincides with the run-up to a euro referendum as seems likely. A Government determined to take Britain into the single currency could scupper King's chances.

Meanwhile, Davies, 51, is a former Deputy Governor at the Bank, director-general of the CBI and controller of the Audit Commission. His great strength lies in having the communication skills needed to fulfil the Governor's traditional role as a bridge between the City and Whitehall. Cantor Index has given him odds of 4-1. He recently revealed that he also has a particular aptitude for stacking barrels of beer, a skill he learnt as a teenager when he worked at a brewery. 'It is a very curious skill. You have to wear clogs,' he said.

Crockett, 59, is a former executive director at the Bank and has also worked at the International Monetary Fund. Although he has a relatively low profile in Britain, he is widely regarded in Whitehall. A proven managerial record, excellent international contacts and experience will count in his favour.