Boston Fed’s Rosengren, citing worsening kidney condition, to retire September 30

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Eric S. Rosengren, Chairman and CEO of the Boston Federal Reserve, speaks at the “Hyman P. Minsky Lecture on the State of the United States and the World Economies” in New York on 17 April 2013. REUTERS / Keith Bedford

WASHINGTON, September 27 (Reuters) – Boston Federal Reserve Chairman Eric Rosengren on Monday announced he would retire on Thursday, September 30, citing a long-lasting health problem.

Rosengren revealed he qualified for the kidney transplant list in June 2020 and wanted to make “lifestyle changes” to protect his health, advancing his scheduled departure until next June, when he will reach the compulsory retirement age of 65.

The Fed official was also under public scrutiny, along with Dallas Fed Chairman Robert Kaplan, for last year’s stock transactions that raised questions about the effectiveness of the rules. ethics of the Fed.

A Boston Fed statement did not mention this controversy, but focused on Rosengren’s revelation to his staff that he was put on the transplant list in June 2020, “following the worsening of ‘kidney disease that he has had for many years. the need for dialysis could be improved if he changed his lifestyle now to reduce the risk of his disease. “

“It became clear that I should aim to reduce my stress so that I could focus on my health issues,” Rosengren said in a letter Monday to Fed Chairman Jerome Powell. “Equally important is that the Federal Reserve Bank of Boston and the Federal Reserve System focus on what is important – bringing the economy back to full employment and carrying out the important work being carried out by the Boston Fed.”

Powell, in remarks included in the Boston Fed statement, said Rosengren had placed a “relentless emphasis” on the safety of the financial system in his work and had “distinguished himself time and time again.”

It was his focus on financial stability, and in particular on possible risks in the commercial real estate market, that drew attention to the investments he made in 2020 in real estate investment trusts.

With Kaplan, which traded millions of dollars in individual stocks in 2020, Rosengren had previously agreed to sell those investments by September 30 amid criticism of the ethics rules from the Fed, including from Powell. The Fed chairman launched a broad review of the Fed’s rules and agreed they needed to be reformed.

September 30 will now also be Rosengren’s last day in office.

Boston Fed Senior Vice President Kenneth C. Montgomery will assume the interim presidency while the search for Rosengren’s replacement is found.

SEARCH FOR SUCCESSOR ‘WELL IN PROGRESS’

Given Rosengren’s mandatory retirement next year, that research is already “well advanced” with a search committee comprising six of the Boston Fed’s board members, none of whom are bankers, according to the report. communicated.

Rosengren, Ph.D. in economics, has been chairman of the Boston Fed since 2007 and has been on staff since 1985. Prior to becoming chairman, he headed the bank’s supervisory and regulatory division.

As one of the 12 chairmen of the Fed’s regional banks, Rosengren took turns serving on the central bank’s policy-making committee.

During his tenure, Rosengren oversaw part of the central bank’s emergency response to stabilize financial markets during the Great Recession and the coronavirus pandemic. This included facilities used to support money market funds during the two downturns and a new Main Street loan program to support lending to small and medium businesses affected by the pandemic.

Rosengren has spoken regularly about the potential risks in financial markets, calling for greater reform of money market funds and urging regulators to take a close look at stablecoins, a type of cryptocurrency tied to a more traditional currency, like the dollar.

He has also participated in Fed events focused on factors contributing to racial economic disparities.

“He will be sorely missed,” Corey Thomas, vice chairman of the Boston Fed board, said in a statement issued by the Boston Fed. “Eric has worked tirelessly during the pandemic downturn to support the country’s economic recovery, never disclosing or complaining of a worsening condition.”

Reporting by Howard Schneider, Ann Saphir and Jonnelle Marte; Editing by Raissa Kasolowsky and Andrea Ricci

Our Standards: Thomson Reuters Trust Principles.

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