WASHINGTON - France's Christine Lagarde and Mexico's Agustin Carstens are on the shortlist to lead the International Monetary Fund (IMF), while Israel's central bank chief, a last-minute entry, was ruled out on age grounds.

The determined backing of crisis-mired Europe made Lagarde the odds-on favorite to become IMF managing director after her countryman Dominique Strauss-Kahn resigned on May 18 to fight sexual assault charges in New York.

Carstens, the Mexican central bank chief who has tried to break the 65-year European lock on the position, acknowledged as much to a Washington audience.

"The chances of Christine Lagarde getting elected are quite high. I'm sure that she will make a good managing director," he said at the Peterson Institute for International Economics.

The two were the only ones named late on Monday when the IMF released the shortlist after nominations closed on Friday.

The IMF did not explain why Israel's Stanley Fischer, who only declared himself at the last minute, was not on the list.

But by the Fund's bylaws, his age at 67 put him two years over the official limit for a new managing director, and obtaining a change or variance to the rules would have been a difficult process, while the executive board has given itself two weeks to reach a consensus on a new head.

The Israeli central bank governor expressed "regret" about his disqualification, saying the age restrictions are "not relevant today".

"I was hoping that the IMF board of directors would change its regulations, not only for the sake of my candidacy, but also for the sake of future candidates for the position of managing director," he added.

Two other potential candidates, a South African minister and Kazakhstan's central bank head, dropped out on Friday, both saying Lagarde was certain to be chosen in an arrangement that has always favored Europeans.

The board said it would meet with the pair in a bid to make a choice by June 30.

Agence France - Presse