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Bank of France Chief To Run Embattled Development Bank

August 18, 1993

LONDON (AP) _ Jacques de Larosiere, governor of France’s central bank, was elected Wednesday to head a European development bank accused of lavish spending abuses.

De Larosiere, 63, faces the task of restoring morale and mending the tarnished image of the European Bank for Reconstruction and Development, which helps nations of eastern Europe convert to capitalism.

De Larosiere replaces Frenchman Jacques Attali, who stepped down in disgrace last month after it was revealed he used a company credit card for personal expenses and secretly maintained a bank office in Paris, among other abuses.

During the bank’s first two years of operations, the bank reportedly spent more money on itself that it spent on the poor nations of the former Soviet bloc.

Taxpayers of wealthy nations, including the United States, picked up the tab for Attali’s extravagance and politicians made no secret of their outrage. The U.S. Congress has been reluctant to spent more money on the bank following the spending scandal.

De Larosiere, formerly a managing director of the International Monetary Fund, is seen as a steady-handed veteran of international banking.

″His distinguished professional record makes him particularly suitable to lead the bank in the period ahead,″ said Anne Wibble, Sweden’s finance minister who is also serving as chairwoman of the bank’s board of governors.

She said the bank under his leadership would be even ″more active″ in helping central and eastern Europe and the former Soviet Union move toward capitalism and closer to western Europe.

De Larosier comes to his new job fresh from a bruising battle with speculators who sought to devalue the French franc against other major currencies.

De Larosiere, named as governor of the Bank of France in 1987, was the only candidate under consideration Wednesday by the bank’s 59 governors. Other contenders, including former Italian Premier Giuliano Amato and former Polish Finance Minister Leszek Balcerowicz, had dropped out.

De Larosiere, who received the votes of 58 governors with one absention, was chosen for a four-year term at the bank and will take office on a date to be announced soon, the bank said in a statement.

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