Conspicuous silence from Madrid as Luis de Guindos prepares to leave the European Central Bank’s vice presidency has fueled speculation that the eurozone’s fourth-largest member is eyeing a bigger prize: the very top job.

The ECB is set for a major leadership reshuffle over the next two years, creating a rare opportunity for national governments to install trusted figures at the top of one of the EU’s most powerful institutions. De Guindos’ post is up for grabs in May next year, while the chief economist role, the presidency and the important markets division will all become vacant in 2027.

While Germany, France, and Italy have always secured one of the six coveted Executive Board seats, Spain has endured a six-year gap without representation. Should it remain silent as the other board seats fill up, this would be a clear indication that Spain wants the top spot.

The Spanish Economy Ministry declined to comment directly, but stressed that “Spain remains firmly committed to having a meaningful and influential presence in key European institutions, as it has consistently done.”

Betting on the presidency is a gamble for Madrid, and the competition is fierce — not least because Germany, which has never held the top ECB post, may also want to seize the chance.

For once, Spain has a strong candidate in Pablo Hernández de Cos, the former Bank of Spain governor who is now general manager at the Bank for International Settlements.

Groomed by former ECB President Mario Draghi, de Cos restored the Bank of Spain’s reputation after a series of missteps before and during the financial crisis. His achievement was implicitly acknowledged by his appointment to two terms as chair of the Basel Committee for Banking Supervision (BCBS), the global standard-setter for bank regulation.

But, inevitably, the shadow of U.S. President Donald Trump looms over the issue. De Cos moving to the ECB could cost Europe the BIS leadership. Given Europe’s fading relevance to the global economy, Trump may persuade others that — with the IMF, BCBS and the Financial Stability Board already headed by Europeans — the Old Continent has more than its fair share of top jobs.

While not powerful, the BIS is a highly prestigious institution commanding a unique overview of global financial flows. Two people familiar with the ECB’s thinking told POLITICO that its current top management is concerned about the risk of losing a slot that has traditionally been held by a European.

Germany’s moment?

Much will depend on Germany, which, like Spain, has never held the ECB presidency. The German government will form an opinion “in due course” but will refrain from speculation today, a spokesperson said.

The country’s previous contenders — Axel Weber and Jens Weidmann — both fell victim to their unbending faith in conservative monetary orthodoxy in times of crisis. But today, after the worst bout of inflation in Europe for over half a century, the climate looks far more welcoming for a more hawkish leader.

As the current Bundesbank President, Joachim Nagel would be the obvious choice. A more moderate voice than either Weber or Weidmann, Nagel may be more acceptable to other member states. However, Nagel — a member of the junior coalition partner SPD — has more than once stepped on the toes of German Chancellor Friedrich Merz — most recently by expressing support for joint European debt issuance to finance defense projects.

Like de Cos, Nagel could also face competition within his own country. Lars-Hendrik Röller, formerly chief economic advisor to then-Chancellor Angela Merkel and still a heavyweight in Berlin policy circles, has floated Jörg Kukies, who was finance minister under Olaf Scholz.

While also a social democrat, Kukies is clearly associated with the right wing of the party and has not recently opposed Merz in public. Kukies may well be an acceptable candidate for the chancellor, a person close to Merz told POLITICO. His impeccable English, PhD in finance from the University of Chicago and a spell leading Goldman Sachs’s German operations would also help his candidacy along.

Mystery woman

But intriguingly, at a recent public event in Berlin, Bank of France Governor François Villeroy de Galhau appeared to suggest that Röller has also been touting a German woman — rather than Nagel — for the presidency.

That woman could be the ECB’s current head of markets, Isabel Schnabel, who is said to be eyeing the post. But ordinarily, no one is allowed to serve more than one term on the Executive Board, meaning that a legal loophole would need to be found to accommodate her. Given the presence of alternative candidates, and given that other member states may view her as excessively hawkish, one former board member said there’s no obvious reason why Germany should risk advancing her.

In any case, Berlin may prefer to support a hawk from another country, to avoid pressure to give up the European Commission presidency early: Ursula von der Leyen’s term expires in 2029.

Going Dutch?

Enter Klaas Knot, who stepped down as president of the Dutch central bank in June after 14 years. Knot, like Draghi, a former chair of the Financial Stability Board, would bring deep institutional experience and monetary policy expertise. He also drew conspicuously supportive comments last month from Lagarde, who said he “has the intellect” as well as the stamina and the “rare” and “very necessary” ability to include people.

Most of the obstacles in Knot’s way look surmountable: while he took a clearly hawkish line throughout the eurozone crisis, he became a far more nuanced team player during his second term. And while the Netherlands would still have a representative — Frank Elderson — on its board when the presidency comes up, a similar situation was dealt with easily enough in 2011, when Lorenzo Bini Smaghi left early to make room for Draghi.

Knot’s only real problem is that he is currently out of the policy circus.

“He will need to find a way to stay visible and relevant to bridge the time,” the former Executive Board member said.

Knot is still tending potentially important connections: he is advising the European Stability Mechanism (the EU’s bailout fund) on strategic positioning, and the European Commission on central bank independence in potential accession countries. He also remains an avid public speaker — with no less than five engagements at the International Monetary Fund’s annual meeting last month.  

But two years can be a long time in European politics.

Carlo Boffa contributed to reporting