Argentina Names Kirchner Friend to Lead CBank

Argentina’s President Cristina Fernandez de Kirchner will name Mercedes Marco del Pont, president of state-owned Banco de la Nacion Argentina, as head of the central bank, replacing the resigned Martin Redrado. Congress must still approve the choice of Marco, a former congresswoman who is seen as a Kirchner loyalist. “The fact that well-respected economist Mario Blejer didn’t accept the post should be considered by the market in a negative light,” RBS says in a research note. “The BCRA’s independence, however undermined during Redrado’s term, is likely to be wiped out going forward,” it adds. RBS expects the Bicentennial Fund plan, where $6.6bn in central bank reserves would help to settle up with creditors and pave the way for a return to borrowing internationally, to be implemented soon after her appointment. “There is growing speculation that Marco could spearhead government favored changes in the central bank charter, since when as a lawmaker she sponsored a project that was perceived to limit the autonomy of the central bank,” adds Goldman Sachs. It also notes that the government still plans to launch an offer to holdouts as soon as it secures regulatory approval in the relevant jurisdictions. Redrado was dismissed for not backing Fernandez’s Bicentennial Fund plan.