Frequently Asked Questions
What is the role of the Federal Reserve Bank president?
Under the Federal Reserve Act, the president of a Federal Reserve Bank is the chief executive officer of the Bank. The president is responsible for all the Bank's activities, including monetary policy, bank supervision and regulation, and payments services. In addition, the president serves on the Federal Reserve's chief monetary policymaking body, the Federal Open Market Committee (FOMC).
How is a Federal Reserve Bank president selected?
The process for selecting a Federal Reserve Bank president is set forth in the Federal Reserve Act. Subject to the approval of the Federal Reserve Board of Governors, the president is appointed by the Reserve Bank's Class B and C directors (those directors who are not affiliated with a supervised entity).
To conduct the search, the Reserve Bank's board of directors forms a search committee composed of Class B and C directors. That committee hires a search firm to help identify a broad, diverse, highly qualified candidate pool. The committee considers a large nationwide pool of candidates, both within and outside the Federal Reserve System, who meet the position's qualifications.
What are the responsibilities of the president, and what attributes are you looking for in a new Federal Reserve Bank president?
The Board of Governors website describes the responsibilities and notes that the Federal Reserve Banks seek candidates who can:
- guide the focus of the Bank's economic research and gather economic intelligence through interactions with the Bank's board of directors and other business and community contacts,
- provide keen insights to Federal Open Market Committee policy discussions,
- communicate clearly about monetary policy,
- be a strong chief executive officer of the Bank,
- ensure that the Bank maintains an effective system of bank supervision by faithfully carrying out its delegated authority from the Board of Governors, and
- make strong personal contributions to matters requiring collective System action or direction.
The Search Committee has developed the following general summary of attributes for the successful candidate.
What is the length of term of a Federal Reserve Bank president?
The president of a Federal Reserve Bank is appointed for a term of five years. The terms of all the presidents of the 12 District Banks run concurrently, ending on the last day of February of years numbered 6 and 1 (for example, 2001, 2006 and 2011). The appointment of a president who takes office after a term has begun ends upon the completion of that term. A president of a Reserve Bank may be reappointed after serving a full term or an incomplete term. Reserve Bank presidents are subject to mandatory retirement upon becoming 65 years of age. However, presidents initially appointed after age 55 can, at the option of the board of directors, be permitted to serve until attaining 10 years of service in the office or age 75, whichever comes first.
Could you describe the role of the search committee?
The search committee of the Federal Reserve Bank of Minneapolis, consisting of all of the Class B and C directors, will interview a range of potential candidates and forward to the Board of Governors a list of up to three finalist candidates, all of whom are interviewed by the governors.
The Bank's Class B and C directors then formally appoint a candidate, subject to the approval of the Board of Governors.
What is the exact timeline for selecting a Federal Reserve Bank president?
The search committee is now in the process of seeking to identify the most highly qualified pool of candidates, with a goal to complete the process by December 2015. As with the appointment with any high level, executive position, the process for selecting a Federal Reserve Bank president shouldn’t be constrained by a specific timeline. What is most important is that the search committee identify the most highly qualified candidates and follow a defined process in consultation with the Board of Governors.