Constantinos Herodotou, former Governor of the Central Bank of Cyprus, is among the two shortlisted candidates, one of whom will be selected to fill the important position of President of the European Banking Authority (EBA).

This is a significant development for Mr Herodotou, even if he is not ultimately selected. Should the opposite occur, it would undoubtedly also be an honour for Cyprus.

To date, no senior banking executive from Cyprus has been appointed to such a high-ranking administrative position within a top institutional body of Europe’s financial sector.

According to information obtained by Brief, his rival candidate is a senior technocratic official of the EBA (existing staff) with extensive experience, a fact that gives him a relative advantage over Mr Herodotou.

On the other hand, Mr Herodotou brings to the table his five-year term on the Governing Council of the European Central Bank (ECB), in his capacity as Governor of the Central Bank of Cyprus.

The professional relationship he developed with Christine Lagarde, President of the ECB, was reportedly very good. This was reflected, among other things, in her two official visits to Cyprus during Mr Herodotou’s tenure at the CBC.

Mr Herodotou and his rival are the only two candidates included on the shortlist and will be assessed through a final interview conducted by a special committee of the European Parliament.

The committee will take into account the expertise and experience of both candidates. However, it remains unclear how heavily the fact that Mr Herodotou’s rival is a long-standing EBA insider and currently a senior technocrat will weigh in the final decision.

The European Banking Authority was established in 2011 to ensure effective and consistent regulation and supervision of the European banking sector.

It coordinates national supervisory authorities and conducts stress tests to assess the stability of the banking system.

The EBA is tasked with implementing a single set of rules for the regulation and supervision of the banking sector across all EU member states.

Its objective is to create an effective, transparent, and stable single market for banking products within the European Union.

The Authority also ensures centrally coordinated disclosure of data relating to EU banks, with the aim of enhancing transparency, market discipline, and financial stability across the EU.

Furthermore, it promotes cooperation among national authorities in the supervision of cross-border banking groups.

It also works to foster a transparent, simple, and fair EU market for consumers of financial products and services, ensuring fair treatment and consumer protection throughout the Union.

Mr Herodotou’s five-year tenure at the Central Bank of Cyprus could be described as effective, as during this period the stability of the domestic banking system improved, non-performing loans were reduced, and domestic banks returned to profitability.