Neel Kashkari, the former assistant Treasury secretary and Goldman Sachs executive who oversaw the Troubled Asset Relief Program, has been appointed to head the Federal Reserve Bank of Minneapolis.

Kashkari, 42, will succeed Narayana Kocherlakota as he concludes his seven-year tenure at the helm of the regional reserve bank. Kocherlakota announced in December 2014 that he would not seek reappointment and Kashkari's new role becomes effective Jan. 1.

Kashkari is well known for his role in helping to design the Tarp initiative during the Bush administration. He later worked at Pacific Investment Management Co., managing new investment projects, before mounting an unsuccessful bid for governor of California in 2014.

As a former Goldman Sachs vice president, Kashkari is following a well-tread path. The investment bank counts several alumni as heads of regional reserve banks, including Patrick Harker in Philadelphia and Robert Steven Kaplan in Dallas, who were both appointed this year.

"We believe that Neel has the right combination of skills: policy-making, management and leadership, banking and financial markets, and communications," MayKao Hang, deputy board chair for the Minneapolis Fed, said in a video released Tuesday.

Kashkari was selected after an eight-month process led by a search committee composed of the Fed's directors who do not represent banks, she said.

In his positions as president and chief executive of the Minneapolis Fed, Kashkari will also join the Federal Open Market Committee, where he will begin voting on matters regarding monetary policy in 2017.

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