Super Fund chief executive Adrian Orr has been named the new Reserve Bank Governor.
Orr will step into the job from March, taking over from acting Governor Grant Spencer.
The New Zealand dollar jumped on the news of teh appointment of Orr, installing a seasoned veteran well known by the business community and possibly more hawkish than the incumbent.
The kiwi rose to US68.86c at 5pm from US68.34c at the start of the day, which was little changed from Friday in New York. The trade-weighted index rose to 72.96 from 72.49.
"Following the Reserve Bank Board's unanimous recommendation to me, I have appointed Adrian Orr for a five-year term at the completion of acting Governor Grant Spencer's term," Finance Minister Grant Robertson said this afternoon.
"I'm delighted the Board has been able to secure a Governor with such a strong track record of delivery and public service. Mr Orr has the technical and leadership qualities required to be Governor and CEO of the Reserve Bank. Further, I consider that he has the skills necessary to successfully lead the Bank through a period of change."
The Government is currently reviewing the Reserve Bank Act and Robertson said Orr was well placed to steer the bank through that review.
"I would also like to thank Grant Spencer for his stewardship in his Acting Governor role. I wish him all the best for his future endeavours from when he finishes his term," said Robertson.
Reserve Bank chairman Professor Neil Quigley said that the Board was pleased to be able to recommend a candidate of Orr's experience.
"Adrian Orr has a significant breadth of knowledge across central and commercial banking, economics, financial markets and regulation.
"Together with his chief executive experience at the New Zealand Superannuation Fund, the Board agreed unanimously that he can bring to the role of Governor of the Reserve Bank strong leadership and commitment to ensure the Bank is fit for its wide role in the New Zealand economy," Professor Quigley says.
Grant Robertson says: "In accordance with the Act, I will sign a Policy Targets Agreement with Mr Orr in March 2018 before he takes up his appointment.
"The Government announced a review of the Reserve Bank Act in November. The work on the first phase of the review, dealing with the objectives and decision-making processes, and role of the Board, will be substantively completed by the end of March.
"While it will not be possible to pass legislation to amend the Act to reflect any changes from the review before the PTA is signed in March 2018, we will ensure that the new PTA is developed in a manner consistent with the direction of reform.
"If necessary, the PTA will be revised again after the Act has been amended to reflect any changes from the review that cannot be reflected within the provisions of the current Act.
"This is an important time for the Reserve Bank and New Zealand's monetary policy framework. Mr Orr has the standing and ability to manage this process of change as Governor of the Bank," Grant Robertson says.
Orr has been the chief executive of the Super Fund since 2007.
From 2003 to 2007 he was Deputy Governor and Head of Financial Stability at the Reserve Bank.
He was chief economist at Westpac in New Zealand from 2000 to 2003, and chief manager of the Economics Department at the Reserve Bank from 1997 to 2000. Prior to this, he held roles at the National Bank of New Zealand, the Treasury, the OECD and the New Zealand Institute of Economic Research.
Catherine Savage, chair of the Guardians of New Zealand Superannuation, the Crown entity that manages the NZ Super Fund, thanked Orr for his service.
"Over the last decade, Adrian's strong leadership, commitment to responsible investment and exceptional communication skills have been instrumental to the success of the NZ Super Fund, which is acknowledged as a high-performing global leader," Savage said.
"Adrian leaves the NZ Super Fund in good heart, with a strong team and with an enviable track record of world-class performance".
"I know that in working for the NZ Super Fund Adrian has valued the opportunity to make a contribution to New Zealand highly. The role of governor of the Reserve Bank will enable him to continue to do this."
Orr said had been privileged to be employed as the chief executive of the NZ Super Fund.
"Likewise, I am honoured to assume the role of governor of the RBNZ next year."