Swiss report calls on central bank to hire outsider as next chairman

By John Revill

ZURICH (Reuters) - The Swiss National Bank should pick an outsider to replace its departing chief Thomas Jordan, a report by a group which campaigns for accountability at the central bank said.

SNB Vice Chairman Martin Schlegel has been floated by Swiss media and experts as favourite to replace Jordan, who announced on Friday he would be stepping down after 12 years in charge.

But Jordan's exit gives an opportunity to broaden the SNB's three-person governing council and improve its transparency, the SNB Observatory said in a report released on Monday in response to last week's announcement.

"Thomas Jordan did a very good job keeping inflation in check, but after 12 years leading the SNB he leaves a long shadow," said Stefan Gerlach, a former deputy governor of the Central Bank of Ireland, and one of the authors of the report.

"It's time for the SNB to go for an experienced outsider," added Gerlach, who is currently chief economist of Switzerland's EFG Bank.

With two years on the SNB's rate setting governing board Schlegel had too little experience in this area, Gerlach said, adding that he was potentially too close to Jordan. Schlegel spent part of his early career at the SNB as Jordan's intern within the central bank's research department.

Antoine Martin, who joined the SNB in January from the Federal Reserve Bank of New York, has not been at the bank long enough to become chairman, Gerlach said.

Historically two of three board members have been from outside, Gerlach said, bringing broader perspectives.

Former Chairman Philipp Hildebrand was from the financial sector and former vice chairman Fritz Zurbruegg was from Swiss finance department before joining the SNB.

The report's co-authors included Yvan Lengwiler of the University of Basel and president of the Swiss government's group of experts on banking stability, and Charles Wyplosz from the Graduate Institute in Geneva.

Jordan's successor will be chosen by the Swiss government after a recommendation from the Bank Council, which is the SNB's supervisory body

The Observatory's report said now was a time to address other issues at the SNB such as increased transparency.

Rules on the SNB's profit distribution also needed to be overhauled, the Observatory said, while the Bank Council needed to be much more forceful.

More women also needed to be promoted at the SNB, said the Observatory, which said only 17% of the central bank's senior management were female, citing SNB figures.

(Reporting by John Revill; Editing by Alexander Smith)