Dame Nemat Shafik, the deputy governor of the Bank of England (BoE), is set to quit Britain's central bank to become the director of the London School of Economics (LSE).

Shafik, who will be the first woman to head the prestigious university when she begins her new role in February next year, has been in her role at Threadneedle Street for just over two years. She joined from the International Monetary Fund (IMF) in August 2014.

During her time at the BoE, she has represented Britain's central bank at the G20, as well as on bodies such the IMF and the Bank for International Settlements.

BoE governor Mark Carney said he was grateful to Shafik for the role she played during her stint at the bank, but added he regretted losing her.

"She helped drive vital reforms on the domestic and international stages, perhaps most prominently in the successful completion of the Fair and Effective Markets Review, which she co-chaired," he said.

"She has overseen a transformation in how we manage our balance sheet and is modernising our high-value payments system."