Originally posted by infolurker
Something I don't know (because I guess I have never really cared) is "How" does someone become a "Fed Chairman"? Is it appointed by the Fed
Board members (I would think so)? What are the qualifications? Anyone "really" know?
The Role of Reserve Bank Directors
* Each Federal Reserve Bank has nine directors, who serve three-year terms and are divided into three groups. Class A directors represent member
banks, whereas both Class B and Class C directors represent borrowers from such areas as agriculture, commerce, industry, services, labor, and
* Directors influence monetary policy by setting their District's discount rate and by appointing the Bank's president, who, in turn, sits on
the Federal Open Market Committee.
* Other responsibilities of the directors include approving the Bank's budget, overseeing operations, and appointing the Bank's officers.
* Each Reserve District's member banks elect both Class A and Class B directors, while the Board of Governors of the Federal Reserve System
appoints Class C directors.
Selection and Representation
Reserve Bank boards of directors are divided into three classes of three persons each. Class A directors represent the member commercial banks in the
District, and most are bankers. Class B and class C directors are selected to represent the public, with due consideration to the interests of
agriculture, commerce, industry, services, labor, and consumers. Class A and class B directors are elected by member banks in the District, while
class C directors are appointed by the System's Board of Governors in Washington. All head office directors serve three-year terms. Two directors of
each Bank are designated by the Board of Governors as chairman and deputy chairman of their nine-member board for one-year terms.
Directors cannot be members of Congress, and class B and class C directors cannot be officers, directors, or employees of a bank. Nor can class C
directors own stock in a bank. In addition, all class C directors must reside in the District for at least two years before their appointment. Because
a Reserve Bank directorship is a form of public service, directors are also expected to avoid participation in partisan political activities.
For purposes of electing directors, District member banks are grouped by amount of capital into three categories—small, medium, and large. Each
group of banks elects one class A and one class B director.
Branches of Federal Reserve Banks also have directors. These directors are not elected; the majority are appointed by the Reserve Bank, and the rest
are appointed by the Board of Governors. The chairman of a Branch board is selected from among those appointed by the Board of Governors. Branch
directors serve for either two- or three-year terms, depending on the size of the Branch board.
Directorships generally are limited to two successive terms, to ensure a diversity of backgrounds and experience among the individuals who serve the
Federal Reserve System.
[edit on 25-8-2009 by VinceP1974]