Reserve Bank chair Neil Quigley has resigned with "immediate effect" after months of scrutiny of his handling of Adrian Orr's resignation as Governor.
The announcement arrived on Friday evening in a brief statement from Finance Minister Nicola Willis, thanking Quigley for his 15 years of service on the board, nine of them as chair.
"Mr Quigley has decided that having overseen a number of key workstreams for the Bank, now is the appropriate time for him to hand over to a new Chair," Willis said.
"He leaves the Bank well-positioned for the future. I thank him for his service and wish him well for the future."
Speaking to RNZ shortly after, Willis was more forthcoming. She said Quigley tendered his resignation following a discussion with her earlier on Friday about the "ongoing criticism" of the board's handling of information surrounding Orr's departure on 5 March.
"My concern was that the bank's reputation was being impacted. He agreed with me that that was a serious matter," Willis told RNZ.
"If he had not offered his resignation, I would have asked him for it."
Willis said she expected the "highest levels of transparency and public accountability" from organisations she worked with: "this matter should have been handled better."
Deputy chair Rodger Finlay would exercise the functions of chair until a new appointment was made, Willis said.
Despite the turbulence, Willis said she had full confidence the bank's board would learn from these events and "draw a line under this".
The recruitment process for a new governor was "well-advanced," she said, with an announcement expected in "the next few weeks".
This is not the first time Willis has publicly expressed disapproval around Quigley's handling of Orr's departure on 5 March.
At the very first media conference, Quigley refused to give any details as to why Orr was leaving apart from describing the resignation as a "personal decision".
Months later, on 11 June, the Reserve Bank revealed Orr had actually resigned over a disagreement with the board around government funding.
This week brought fresh revelations about the saga.
On Wednesday, emails released under the Official Information Act displayed a spat between the Reserve Bank and Treasury over whether certain information should have been made public.
And on Thursday, the Ombudsman required the Reserve Bank to release a timeline of events leading up to Orr's departure, revealing he had temporarily stood down several days before his resignation was made public.
It also revealed that Orr's resignation had been preceded by the board sending him a letter of concerns and then an exit agreement being reached.
On both occasions, the Taxpayers' Union issued statements calling on Willis to "protect the dignity of the Reserve Bank" and sack Quigley.
"This has gone beyond questions about the credibility of the Reserve Bank. It's now a matter of honesty," Taxpayers' Union executive director Jordan Williams said.
"[Quigley's] continued presence at the helm of the Reserve Bank Board undermines public trust. He must resign - or be removed by the Minister."
Speaking on RNZ, Infometrics chief executive Brad Olsen said the exit gave the bank a good chance to reset with a new chair and governor.
He told RNZ's Panel that he had not expected the announcement on a Friday evening and cited concerns about "trust and transparency" surrounding the central bank.
"Remember when the governor Adrian Orr resigned very unexpectedly, we were told at the time there was nothing untoward - just that the governor had decided now is the time to exit.
"As the time has gone on we have heard more and more information that clearly shows that wasn't the case. There were concerns building up."
In a statement, Labour finance spokesperson Barbara Edmonds said it was "disappointing" that end of Quigley's time at the Bank had been marred by the "poor handling" of the resignation of the previous Reserve Bank Governor.
