Balcerowicz purge signals NBP moves to assert independence
National Bank of Poland (NBP) president Leszek Balcerowicz could use his recent purge of top personnel on the banks management board to assert its independence prior to the Sept. 23 elections, analysts said last week.
The SLD (Democratic Left Alliance) may not be as concerned with the NBPs independence as it perhaps should be, said a banking analyst in Warsaw who preferred to remain anonymous. And that may have been a factor in Balcerowiczs decision.
The leftist opposition coalition of SLD and Labor Union (UP) is almost certain to win the parliamentary elections and has said it wants to have more control over monetary policy than the constitution allows.
Balcerowicz last week sacked four members of the banks management board saying he was unhappy with the rate and quality of their input into the banks management. He said he would replace them with four new members more likely to be in line with his policy positions, though the bank declined to offer further details.
Various SLD members have floated ideas over the past year about the NBPs independence. Many in the party believe the banks power, for example its ability to set interest rates, inhibits the role any government has in fiscal policy. For the SLD, which has set reducing unemployment as a policy goal, control over monetary policy could enable it to engineer fiscal surpluses that could be earmarked for employment programs. Critics, on the other hand, said this would have a direct inflationary impact.
In June the SLD forwarded a bill to the Sejm that would have reduced the powers of the NBP, but it failed to hit the statutes.
Most analysts said, however, that Balcerowiczs recent personnel decisions were more likely driven by a desire to consolidate his position in his first year in charge of the bank and would most likely not have a great impact on the banks policy.
It is the Monetary Policy Council (RPP) that is the key institution in setting rates, and changes in the NBPs management may or may not have any impact there, said Mateusz Szczurek, an economist at ING Barings.
Other analysts said Balcerowiczs personnel changes were more cosmetic, as all the dismissed members of the board will continue working for the bank.
This is a normal move and happens often when one NBP president replaces another, said Maciej Reluga, an analyst at ING Barings Securities in Warsaw.
Balcerowiczs decision must now be approved by President Aleksander Kwaniewski and Prime Minister Jerzy Buzek, though no such changes at the bank have been refused since 1990.
Economist Andrzej Bratkowski was tipped last week to become the new deputy governor of the bank, to be joined by four of the following five candidates: Ewa Popowska, Krzysztof Majczuk, Waldemar Szostak, Joanna Wielgórska-Leszczyńska, the director of the NBPs accounts department, and Józef Sobota, director of the statistics department.
Bratkowski is said to favor faster moves to introduce the euro into Poland. Analysts said this was not likely to be an NBP policy in the near future, though his position in the NBP could shift the banks focus closer toward EU-related monetary issues.
The NBP president is appointed by the Sejm, at the request of the president, for a term of six years. The president chairs the RPP.
