Mervyn King, the Governor of the Bank of England, has turned to a veteran City lawyer to replace Dame Juliet Wheldon as his chief legal adviser.

Graham Nicholson, a mergers and acquisitions specialist at Freshfields Bruckhaus Deringer, the world's third-largest law firm by revenue, will take over the role of Chief Legal Adviser and Adviser to the Governor on January 1, 2009, the Bank announced today.

Dame Juliet has been one of Mr King's closest advisers since joining the Bank in August 2006. A long-serving and distinguished civil servant, she was previously Treasury Solicitor, the head of the Government Legal Service. She was the first woman to hold the post.

Mr Nicholson joined Freshfields in 1971 and was managing partner of the firm from 1990 to 1993. He has been involved in high-profile deals for clients such as Alliance & Leicester and the London Stock Exchange and was the partner in charge of the firm's work for Rolls Royce.

Mr King said: "I am delighted that Graham has agreed to join the Bank. He has been a partner at Freshfields for the past 28 years and has a very good knowledge of the Bank. He also brings a wide experience of corporate law and the financial sector.”

Speaking of Dame Juliet, he added: "I am immensely grateful to Juliet for her support over the past few years, which have proven to be an exceptionally busy period.”

Historically, Freshfields has been the City firm most closely aligned to the Bank of England. It recently advised the Bank on the nationalisation of failed mortgage bank Northern Rock.

Guy Morton, joint senior partner at Freshfields, said: "Graham has made an exceptional contribution to the firm over many years, both in terms of client work and firm management. We thank him for his tireless efforts and are delighted that he has now been appointed to this very important role."

Explore Law

• Columnists

• Law Panel

• Law Reports

• Student Law

Times Recommends

• BGC 'set aside £40m to lure Tullett brokers'
• Legal aid review to ensure value
• Fears as 21 magistrates' courts face closure