Washington - The director of the did not abuse his authority in an extramarital affair he had with a subordinate and the fund's board said Saturday it planned to continue with Dominique Strauss-Kahn at the helm.

The 24-member IMF executive board met Saturday to review an investigation into the matter and said in a statement it had "concluded that there was no harassment, favoritism, or any other abuse of authority by the managing director."

The investigation concerned his alleged relationship with Hungarian-raised Piroska Nagy, who was a senior official in the IMF's Africa department and now works for the European Bank for Reconstruction and Development in London.

The board said "the incident was regrettable and reflected a serious error of judgment on the part" Strauss-Kahn, but stressed that it was ready to move on. (dpa)