FRANKFURT — The head of the Swiss central bank unexpectedly resigned Monday, saying that doubts about currency trades he and his wife made last year threatened to undermine his ability to focus solely on steering the bank through a global financial crisis.
The resignation of Philipp M. Hildebrand, who had an international reputation as an advocate for tougher bank regulation, came as a surprise. Just last week, he offered a detailed defense of his conduct and appeared to have the support of the council that oversees the Swiss National Bank.
Speaking at a news conference in Bern, Mr. Hildebrand said he still does not believe he did anything wrong. “I stand by my word that I never lied,” he said.
But, he said, he came to the conclusion that he could not prove to doubters that he had not known about a $500,000 currency transaction his wife made days before the S.N.B. stepped up its intervention in currency markets. “I can’t once and for all prove that it was the way I said it was,” he said.
“Credibility is a central banker’s most valuable asset,” Mr. Hildebrand said. The accusations might have been a burden “during a time when total focus is needed on the duties” of the office, he said.
Mr. Hildebrand wil be replaced at least temporarily by Thomas Jordan, vice president of the S.N.B. He could face market challenges to the bank’s attempt to enforce a limit on the value of the franc against the euro.
“We do not expect any change in the conduct of the Swiss monetary policy,” Julien Manceaux, an analyst at ING Bank, said in a note to clients. The exchange rate floor “is here to stay, with or without Philipp Hildebrand.”
For much of the last three years, the S.N.B. has been engaged in a battle to keep investors from bidding up the value of the Swiss franc, which is seen as a haven from global turmoil. The rise of the franc against the euro and other currencies threatened to make Swiss exports too costly on world markets.
Mr. Hildebrand said he would also step down from several other posts that have made him an influential voice in the debate about how to limit risk-taking by banks and avert future financial crises.
He is vice president of the Financial Stability Board, a group of central bankers and regulators who advise the Group of 20 nations on measures to make the global banking system safer.
Mr. Hildebrand said he would also step down as a member of the board of the Bank for International Settlements, an institution based in Basel, Switzerland, that acts as a clearinghouse for national central banks.
He said he would also resign as one of two Swiss representatives on the board of governors of the International Monetary Fund.
“This is a step which saddens me greatly,” Mr. Hildebrand said. “I depart on good terms and I would like to think I have been a damn good central banker.”
Mr. Hildebrand faced accusations that he or his wife bought and sold large amounts of dollars last year at the same time that the S.N.B. was intervening in currency markets.
The accusations came to light in late December after a former information technology worker at Bank Sarasin, a Swiss private bank, gave information from Mr. Hildebrand’s personal account to the right-wing Swiss People’s Party.
The party, which has substantial popular support, has been sharply critical of the monetary policy pursued by Mr. Hildebrand, as well as his efforts to constrain risk-taking by Swiss banks.
Mr. Hildebrand’s stands on banking regulation have made him some enemies in the industry, something he alluded to Monday. He said he received an e-mail from a friend quoting Woodrow Wilson: “If you want to make enemies, change some things.”
The Bank Sarasin employee who passed on the information about Mr. Hildebrand’s accounts faces criminal charges for violating bank secrecy laws. The 39-year-old man, who has not been identified, is in a psychiatric clinic after attempting suicide, the newspaper Sonntagszeitung and other Swiss media reported.
Article source: http://feeds.nytimes.com/click.phdo?i=a647f1d01f9626b667f306803d0c7992
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