FINANCE MINISTER Brian Lenihan has decided to appoint a new financial regulator from outside the country, with headhunters appointed by the government recently contacting candidates from Canada, the country regarded as having the strongest financial regulation in the world.

The new director will serve under recently-appointed Central Bank governor Patrick Honohan and will oversee regulatory risk, markets and financial institutions.

Sources with direct knowledge of the headhunting process told the Sunday Tribune the assistant superintendent of Canada's financial regulator, Ted Price, was the most likely candidate. But Price said through a spokesman he had not been in contact with officials in Ireland or with London headhunting firm Spencer Stuart, which is conducting the search.

However, it is understood the Department of Finance has been interviewing candidates from Canada as well as other jurisdictions. Sources involved in the selection said the pool of applicants includes candidates who were approached by the government as well as some who responded to notices in the Financial Times.

Honohan will be starting his job as the new Central Bank Governor tomorrow with three of the four senior Irish regulatory jobs either filled or at an advanced stage of being hired even before he gets his feet under the table at the Dame Street offices.

The government has made no secret of its intention to adopt Canadian financial regulatory practices and structures. The remodeled Central Bank, which brings regulation and financial stability back together under one roof, is understood to be influenced by the Canadian set-up.