When Mester was about to retire, the Cleveland Fed began looking for a new leader

Federal Reserve Bank of Cleveland President and CEO Loretta J. Meister visited Teton National Park, where financial leaders from around the world had gathered for the Jackson Hole Economic Symposium outside Jackson, Wyoming, US. REUTERS/Jim Urquhart/File photo obtained by license rights

NEW YORK, Nov 8 (Reuters) – The Cleveland Federal Reserve said on Wednesday it had begun a search for a replacement for current president Loretta Meister, the veteran central bank who has led the regional bank since 2014.

Meister is scheduled to retire on June 30, 2024, due to federal law that limits officials’ tenure on age and length of service. During her tenure, she has been one of the more hawkish voices at the US central bank and has sometimes favored tighter monetary policy than her colleagues.

The search process will be overseen by members of the Cleveland Fed’s board of directors who do not come from institutions controlled by the central bank.

The process will be led by Heidi Gartland, University Hospitals’ chief government and community relations officer and vice chair of the Cleveland Federation’s board. The US central bank must approve the Cleveland Fed’s election.

The 12 regional federal banks operate under the supervision of the Federal Board of Governors in Washington, but are technically quasi-private institutions owned by local banks. Their respective boards are from the private sector.

“Meister’s strong leadership over the past decade has positioned the Cleveland Federation as a valuable asset to the community and the nation,” Gartland said in a press release announcing the start of the search.

Gartland added, “Thanks to her insight, energy and commitment to public service, the Cleveland Federation is today recognized around the world for high-quality economic research, financial institution regulation, community development delivery and funding.” Services.”

Leadership flow

State federal bank searches have become controversial in recent years because of the transparency of the process. While federal officials in Washington are elected by the US president and the Senate through a popular process, state federal leaders are chosen behind closed doors and the public does not know who is running for a position that helps shape and control the nation’s monetary policy. Local financial institutions.

The leadership of the state federation has been volatile over the past few years. Two officials left in early September 2021 amid questions about their investment practices, and the Kansas City federation continued its search for new leadership even as its own predecessor, Esther George, faced the mandatory retirement. Also, the St. Louis Fed is looking for a new boss to lead Purdue University’s business school after former chief James Bullard abruptly quit over the summer.

Fed banks have also come under increasing pressure in recent years to separate their leadership from white men from business or finance backgrounds. To this end, several regional federated banks have identified diversity as a key consideration in their respective search processes.

Meister is leaving the Fed after spending most of her professional life at the central bank. Before coming to the Cleveland Fed, Meister headed the research division of the Philadelphia Fed.

Meister, according to data from Wrightson’s IAPAP, was defeated by 8% of her Federal Open Market Committee and supported a tighter policy stance than that favored by other policymakers. Mester specifically voted against part of the federation’s initial response to the coronavirus outbreak in March 2020.

State federal leaders must retire when they reach 65. If they join the central bank after the age of 55, they can be allowed to serve for 10 years or up to 75, whichever is earlier. According to the Brookings Institution, the next state federal official to retire due to age is Philadelphia Federation President Patrick Hacker in June 2025.

Reporting by Michael S. Derby; Editing by Paul Simao

Our Standards: The Thomson Reuters Trust Principles.

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