Bank of Israel Governor Stanley Fischer said on Saturday he had decided to stand as head of the International Monetary Fund, presenting a potential serious challenge to front-runner Christine Lagarde.

There arose an extraordinary and unplanned opportunity, perhaps one that will never happen again, to compete for the head of the IMF, which after much deliberation I decided I wish to follow through on, Fischer said in a statement.

This, even though it is a complicated process and despite the possible barriers, Fischer said in a statement.

Fischer, 67, would be a serious contender to the current favorite for the post, French Finance Minister Christine Lagarde.

But the IMF would have to change its rules that no one should be appointed to the post who is 65 or older and that no one should hold the post beyond the age of 70.

Israel's Channel 2 TV had earlier reported that Fischer's name was in the final list of candidates for the job vacated by Frenchman Dominique Strauss-Kahn, who resigned after his arrest on May 14 on charges of attempting to rape a New York hotel maid.

A Reuters poll of economists from all over the world, published in May found 32 of 56 saw Lagarde, who is backed by the European Union, as the favorite, although Fischer won the most votes as best suited for the job.

Fischer is a former deputy managing director of the IMF. He has been widely credited with helping Israel's economy weather the global financial crisis by starting to lower Israeli interest rates sharply in 2008.

He has since raised rates 10 times to contain inflation and prevent an overheating economy set to grow another 5 percent in 2011.

(Reporting by Steven Scheer and Tova Cohen; Writing by Maayan Lubell; Editing by Andrew Heavens)

Israel International Monetary Fund