Lesetja Kganyago named new Reserve Bank governor

Kganyago has been with the bank since May 2011 after heading the national treasury for more than seven years as director general. (Gallo)

Kganyago has been with the bank since May 2011 after heading the national treasury for more than seven years as director general. (Gallo)

Lesetja Kganyago (48) has been appointed as the next governor of the South African Reserve Bank following Gill Marcus’ resignation at the end of her first term as head of the national financial body.

President Jacob Zuma announced the appointment at a press briefing on Monday. 

Kganyago’s term will begin on November 9. 

It was initially expected that Kganyago would replace outgoing governor Tito Mboweni in 1999 but the job went instead to Marcus.

Kganyago has been with the bank since May 2011 after heading the national treasury for more than seven years as director general.

Some observers felt he had begun to emerge as the natural choice, having overseen bank supervision, exchange control regulation and risk and compliance. Kganyago spent several years at the Congress of South African Trade Unions and has worked with Finance Minister Nhlanhla Nene at the treasury.

A previous review by Nomura financial services group of voting by the monetary policy committee showed that Kganyago would most likely not be averse to voting in favour of interest rate hikes if the situation required it, depending on the circumstances.

Both Zuma and Kganygo referred to the constitutional mandate given to the Reserve Bank to protect the value of the currency in the interest of balanced and sustainable growth. 

Kganyago’s promotion will leave a vacuum in the position of deputy and Zuma said his replacement would be appointed “in due course”.

‘Hard act to follow’
Zuma commended Marcus’ work over the past five years, saying the Reserve Bank had “acted independently, without fear, favour or prejudice” and thanked her for her dedication and leadership in a difficult economic climate.

Marcus said that it was a hallmark of the depth of the organisation that a successor was chosen from within the bank.

“No matter how you look at it, Marcus is going to be a hard act to follow,” said Azar Jammine, chief economist of advisory service Econometrix. “She had a broad, detailed view and political experience and a history in the struggle against apartheid.”

Marcus is a former deputy finance minister and chair of Absa.
She also worked under Mboweni at the treasury for five years, starting in 1999. She allegedly left because of personality clashes between them.

Among other challenges, the new governor faces rising inflation and an economy that looks set to grow at the slowest pace since the 2008 recession.

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