President Recep Tayyip Erdogan has appointed Hafidha Ghaya Arkan, a former U.S. financial executive, as Turkey's central bank heads as the bank prepares to change course and tighten policy after years of interest rate cuts and a costly living crisis.

Hafiza Arkan previously served as Co-CEO of First Republic Bank and Managing Director of Goldman Sachs. Hafizat Arkan will take over after Erdogan's re-election on May 28, less than a week after the president signaled the country would move away from unconventional economic policies.

Hafidha Arkan will be the fifth to assume the presidency of the Central Bank in 4 years, replacing Shihab Kavcioglu, who led Erdogan's campaign to cut interest rates that triggered a historic collapse of the national currency in 2021 and pushed inflation to a 24-year peak when it exceeded 85% last year.

The announcement of the appointment of Hafidha Arkan in the Official Gazette was accompanied by the decision to appoint Kavcioglu as head of the Banking Regulation and Supervision Authority (PDDK).

The central bank cut the interest rate to 8.5% from 19% in 2021, and the lira is largely managed through dozens of regulations covering credit and foreign exchange.

The Turkish currency fell to record a streak of all-time lows this week, trading at 23.5010 liras to the dollar following the announcement, near a record low.

President Erdogan chooses seasoned banker Hafize Gaye Erkan to succeed Sahap Kavcioglu as the governor of Türkiye's central bank

— TRT World (@trtworld) June 9, 2023

Educational and professional path

According to Turkish media, Hafiza Arkan, born in 1982, is an economist, engineer and daughter of a mechanical engineer, and was a mathematics teacher.

As for her educational path, she studied in Istanbul, graduating from the Department of Industrial Engineering at Bogazici University in 1997 with an excellent grade, before moving to the United States to study at Princeton University, during which she received scholarship offers from 9 universities, including Stanford, Princeton, Boston, Cornell and California.

Hafiza Arkan received her Ph.D. in Financial Engineering and Applied Mathematics from Princeton University.

She also held senior management positions in a number of financial advisory firms and a bank, and worked at First Republic Bank from 2014 to 2021, according to her LinkedIn profile.