Friday, March 24, 2023

ECONOMY | 14-06-2018 20:37

Central Bank switch: Sturzenegger resigns, Luis Caputo to replace him

Government says outgoing Central Bank chief presented resignation; Casa Rosada says functions of Finance Ministry and Treasury will be reunified.

In a dramatic economic reshuffle, Finance Minister Luis Caputo has been appointed as the new chief of the Central Bank, replacing Federico Struzenegger, who resigned his post earlier today.

The government said Sturzenegger had “today presented his resignation to President Mauricio Macri at a meeting” at the Olivos presidential residence.

"It has been an honour to serve from this position and I want to thank my team and the entire Central Bank for the effort over these years," the outgoing official posted on Twitter.

The government said Caputo, 53, would replace him at the helm of the institution, with the Finance Ministry’s functions set to come under the wing of Treasury Minister Nicolás Dujovne. Caputo’s appointment will need to be confirmed by the Senate.

The move comes after a day in which the peso rose to a new record against the dollar. The national currency, which began the year at around 18.65 pesos to the US dollar, today reached a new high before closing at 28.43 pesos.

The peso has suffered a turbulent time in the exchange markets in recent weeks and Sturzenegger has come under criticism for the Central Bank’s attempts to stabilise the currency.

President Mauricio Macri and his government recently agreed a deal with the International Monetary Fund (IMF) for a stand-by loan of US$50 billion over a three-year period.


Caputo, a hedge fund manager with a history of working for top Wall Street banks, was responsible for the successful negotiation with the so-called ‘vulture’ holdout funds.

Well liked by the markets, Caputo does bring some controversy with him too. Back in February, a Perfil and La Nación investigation revealed he had failed to declare information about his stake in offshore companies that manage hundreds of millions of dollars in tax havens.

From August 2009 to July 2015, Caputo was the major shareholder of the Princess International Group based in the Cayman Islands. He held more than 75 percent of the company’s shares. However, he failed to include this information in legally-required affidavits for the 2014 financial year, which were presented to Argentina’s Anti-Corruption Office (OA) when he became a public servant in December 2015. He also withheld information in 2016 regarding the 2015 financial year.

The omission of this kind of information is a crime in Argentina and is punishable with up to two years in prison.

Caputo has repeatedly denied wrongdoing and said that while he fronted offshore accounts for third parties, he was not an owner of the companies in question.


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