The Federal Reserve Bank of Boston said Tuesday that it formally launched its search for a new president, following the early retirement last month of Eric Rosengren amid a controversy over personal investment trading by Fed officials.
The search committee, headed by Boston Fed chair Christina Paxson, is under pressure to consider a diverse group of candidates. Among the 12 current and interim regional Fed presidents, just three are women and two are men of color.
“The committee is approaching this search in a very open and broad way — doing a lot of outreach, collecting information and ideas from stakeholders, and being very open to ideas about who could be great in this position,” Paxson, who is president of Brown University, said in a video on the bank’s website.
“We will be looking for a wide and deep and diverse talent pool,” Corey Thomas, deputy chair of the board and chief executive of Rapid7, a Boston cybersecurity company, said in the video.
Only directors without ties to regulated banks or financial institutions are eligible to help select a Federal Reserve Bank president. The choice must be approved by the Federal Reserve’s Board of Governors.
“The process that the board of the Boston Fed announced today is still very opaque and corporate-led, which should concern everyone,” said Benjamin Dulchin, director of the Center for Popular Democracy’s Fed Up Campaign, which is pushing for more diversity at the central bank. “The community doesn’t know what criteria the committee will use to pick a president and the committee members are mostly CEOs of big corporations.”
Rosengren, 64, stepped down at the end of September, citing a deteriorating kidney condition. His announcement came a few weeks after a watchdog group called Better Markets called on Rosengren and Dallas Fed president Robert Kaplan to resign after they disclosed trades made last year when the Fed was taking extraordinary steps to prop up the economy and financial markets. The trades were included in the financial disclosure forms filed each year by top Fed officials.
Rosengren and Kaplan, who retired last week, have said their trading followed all Fed guidelines.
Kenneth Montgomery, formerly the Boston Fed’s first vice president and chief operating officer, is serving as interim president until Rosengren’s successor is named, a process the bank has said could take around six months.