Riksbank starts open recruitment procedure for board members

Sweden’s central bank is set to implement a new procedure to recruit board members, it said on November 20.

The new central bank act, which came into force on January 1, requires Sveriges Riksbank to publish and advertise a recruitment profile for these positions, and run an open selection process.

The procedure will first apply to select the replacement for deputy governor Martin Flodén, whose term in office expires on May 21, 2024.

Flodén has been serving in the Riksbank’s board since 2013. His five-year term was renewed in 2018. Under the central bank law, board members can only be elected to a maximum of two terms.

The chair of the Riksbank’s general council Bo Broman and vice-chair Tomas Eneroth said in a joint comment: “It takes time to bring these recruitments to a successful conclusion. That is why we want to start work now.”

They added: “The general council will start applying the new law now, and we have therefore informed Martin that we will be looking for a new member.” 

The new central bank law is having further consequences for the Riksbank. For instance, in October governor Erik Thedéen told the Swedish parliament that the institution needs a capital injection to comply with the law.

In 2022 the central bank recorded a loss of over Skr80 billion ($7.2 billion). This contributed to an overall negative result of -Skr18 billion. The new law establishes a target level for the Riksbank’s equity of Skr60 billion, and a floor of Skr40 billion.

The law says the central bank must submit a petition to parliament to restore its equity if this falls below Skr20 billion.