The director of the French Treasury, Jean Lemierre, has been elected as the new head of the European Bank for Reconstruction and Development EBRD.

The decision was announced at the EBRD's annual meeting in the Latvian capital, Riga, which is being attended by central bankers and finance ministers from sixty member countries.

Mr Lemierre replaces Horst Koehler, who stepped down earlier this year to head the International Monetary Fund.

Correspondents say Mr Lemierre's appointment will increase French influence within the bank, since the French Finance Minister, Laurent Fabius, is already the chairman of the board of governors. The bank was set up in 1991 to help former Soviet states to make the transition from communist to market economies.

From the newsroom of the BBC World Service