ZURICH: The Swiss National Bank said on Friday its vice-chairman Jean-Pierre Danthine who helped introduce a cap on the value of the Swiss franc will step down next June after reaching retirement age as well as the end of his term.
Danthine was given the task of implementing the minimum exchange rate when it was first introduced in September 2011. Since 2012 he has been responsible for financial stability which includes overseeing Switzerland's too-big-to-fail laws.
Danthine's retirement is the biggest news out of the SNB in a week where the Swiss franc has hovered perilously above the 1.20 franc per euro threshold imposed by the central bank.
Concerns over Ukraine have drawn investors to the traditional safe-haven currency and the European Central Bank's latest stimulus measures have weakened the euro, keeping pressure on the franc cap ahead of the SNB's next rate decision on Sept. 18.
A spokesman for SNB said the central bank will start looking for a replacement to Danthine fairly soon and that any successor would likely be from French-speaking western Switzerland, in an unspoken policy of preventing an all-German-speaking board. The other two members, Thomas Jordan and Fritz Zurbruegg, have German as their mother tongues.
"The Bank Council and the Governing Board would like to thank Jean-Pierre Danthine for his strong commitment to a stability-oriented monetary policy and for his outstanding services on behalf of the SNB," the central bank said in a statement. His term ends in June, 2015, close to his 65th birthday in May.
In the immediate aftermath of the announcement, the franc strengthened to session-highs against the euro but has since weakened to trade within the day's range. The three-person SNB board sets monetary policy and oversees the franc cap.
Each of the three oversees a department at the bank; one focusing on international affairs, another on financial stability, and one on operational issues.
Swiss law states that board members must be Swiss, live in the country and have a "flawless reputation and a stated knowledge of currency, bank and financial questions".
The government elects them for six years, though Danthine will serve five years of a six-year term. The SNB stands ready to intervene in the foreign exchange market to defend its cap on the franc and could take further measures to ensure price stability, its chairman told a newspaper last week.
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