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Thomas Jordan’s first test as interim president of Switzerland’s central bank will be to prove he can defend the four-month old cap on the franc as well as its chief architect did.

As Jordan, 48, emerges as the frontrunner to replace Philipp Hildebrand on a permanent basis, he faces the challenge of showing investors a change in personality at the top doesn’t signal a shift in the Swiss National Bank’s foreign-exchange policy. Hildebrand resigned on Monday after failing to quell a furor over currency trading by his wife, leaving Jordan as guardian of the franc before a permanent successor is chosen.

“He looks like the most likely candidate,” Ankita Dudani, a foreign-currency strategist at Royal Bank of Scotland Group in London, said. “He’s got the confidence of the markets already.”

Whoever wins the race to lead the SNB will inherit a 105 year-old institution which has pledged to devote unlimited funds to prevent gains in the franc after paring its benchmark interest rate to zero. The task faced by Hildebrand’s successor may be burdened with internal change as the central bank revisits ethics rules to avoid a repeat of the controversy.

The SNB Bank Council, the central bank’s supervisory board, was holding an extraordinary meeting in Zurich on Tuesday. A successor will be named as soon as possible, Hansueli Raggenbass, head of the council, said. While the council will suggest a candidate to the board, it’s up to the government to pick an appointment.

The Swiss currency surged to the highest since September against the euro after Hildebrand’s announcement. It pared gains after the SNB said it remains ready to defend the franc cap of 1.20 versus the euro with the “utmost determination,” a stance repeated later by Jordan. The franc traded at 1.2116 versus the euro in Zurich on Monday, little changed on the day. It was at 94.77 centimes versus the dollar.

“The knee-jerk reaction from the market is to buy francs,” said Elizabeth Gregory, a market strategist at Swissquote Bank in Geneva. “Even without Hildebrand spearheading the campaign against the franc appreciation, the SNB is likely to defend the 1.20 floor vigorously.”

Unlike Hildebrand, whose career took him from hedge fund roles in London and New York to Swiss private banks, Jordan has a largely academic background with three years spent at Harvard University in the 1990s. The native of Biel in Switzerland’s French-speaking part studied economics and business studies at the University of Bern and achieved a doctorate in 1993.

After completing his post-doctoral research at the Department of Economics at Harvard, he joined the Zurich-based central bank in 1997 as a head of the Economic Studies unit. A year later, he was appointed lecturer at the University of Bern. Between 2002 and 2007, he taught monetary policy at the University of Zurich and was appointed honorary professor at the University in Bern in 2003. In 2007, Jordan was appointed SNB board member before becoming vice chairman three years later.

It was Jordan who told Tages-Anzeiger newspaper in August that a temporary franc peg would be consistent with the SNB’s mandate, paving the way for the bank’s biggest policy shift since the 1970s, when it capped the currency at 1.20. The SNB, which on Dec. 15 maintained its ceiling and held borrowing costs at zero, will hold its next quarterly assessment in March.

Bloomberg