Heather Ridout joins RBA board

Australian Industry Group chief executive Heather Ridout has been appointed to the board of the Reserve Bank of Australia, and Philip Lowe has been appointed the bank's deputy governor.

The new appointments were announced by Federal Treasurer Wayne Swan and will take effect from February 14, 2012.

Ridout will succeed Graham Kraehe and has been appointed for a five-year term.

Lowe’s seven-year appointment succeeds Ric Battellino, who will retire from the RBA after 39 years in February 2012.

“Mrs Ridout brings to the board both an extensive business background and a strong understanding of public policy. Her understanding of the manufacturing sector in particular will be valuable to the board at a time when different sectors of our patchwork economy face different pressures,” Swan says.

Aside from her role as chief executive of AIG, Ridout also serves on the boards of AustralianSuper Pty Ltd., Australian Super Trustee Board, and the Australian Research Alliance for Children and Youth.

Ridout was quick to acknowledge her appointment, saying it would be an “honour to be appointed to this most important position”.

“I have an abiding interest and commitment to strong and balanced economic policies and to have the opportunity to serve Australia in this role will be a great privilege,” she says.

Swan also praised Lowe and says he will suit his new role.

“Dr Lowe's promotion comes after a very distinguished career at the RBA beginning in 1980. He served as head of financial institutions and infrastructure division at the bank for international settlements between 2000 and 2002, where he published influential work on financial stability matters. Between 2004 and 2009, Dr Lowe oversaw the RBA's work on issues related to financial stability and payments system policy,” says Swan.

He has served as the economic assistant governor since April 2009 and has been the chief economic adviser to the governor and the Reserve Bank board.