As Greece Flares, Treasury’s Geithner Endorses Lagarde For IMF Lead

Finance MinisterChristine Lagarde gained a key ally for her effort to be named head of the International Monetary Fund Tuesday, when the Treasury Department issued a statement from Secretary Tim Geithner supporting her candidacy.

The leadership of the IMF, traditionally held by a European, has been up for grabs since the resignation of Dominique Strauss-Kahn, who was arrested on allegations of sexual assault.

Lagarde is angling for the IMF job at a time when the organization is a central player in the debt crisis throughout the periphery of Europe. The Greek mess continues to play out, with violent protests erupting outside Parliament Tuesday morning on the first day of a two-day strike as lawmakers debate a controversial package of austerity measures.

France has taken a softer line on a potential Greek restructuring of late than fellow European leaders in Germany, recently proposing a plan that would see French banks roll over their debt to give Greece breathing room. The slight change of heart comes as little surprise, given the sizable exposure the banks have to Greek debt. (See “French Banks Hold $93B In Greek Debt, Sarkozy Announces Rollover Deal.”)

See Geithner’s full statement endorsing Lagarde below.

Secretary Geithner Supports Christine Lagarde For IMF Managing Director

6/28/2011 WASHINGTON – Today, the U.S. Department of the Treasury issued the following statement from Secretary Tim Geithner.“I am pleased to announce our decision to support Christine Lagarde to head the International Monetary Fund. Minister Lagarde’s exceptional talent and broad experience will provide invaluable leadership for this indispensable institution at a critical time for the global economy. We are encouraged by the broad support she has secured among the Fund’s membership, including from the emerging economies. I also want to commend my friend, Agustin Carstens, on his strong and very credible candidacy.”