WASHINGTON - Federal Reserve Board Governor Edward W. Kelley Jr. said Monday that he intends to resign as soon as one of two current vacancies on the seven-person board is filled.
The longest-serving Fed governor, Mr. Kelley joined the board in May 1987, three months before Chairman Alan Greenspan. In an interview Monday, Mr. Kelley described his tenure as "a wonderful time and an enormous honor," and he said his 14 years in Washington have been "highly rewarding."
The Fed's board can operate with as few as four active members - the minimum required for a quorum - but nevertheless, he said he will stay until a successor for one of the two open slots is confirmed by the Senate. "We need to have five persons active on the board in order to effectively and efficiently carry out our duties."
The two currently vacant slots on the board were last held by Susan M. Phillips, who resigned in 1998, and Vice Chairwoman Alice M. Rivlin, who left in July 1999.
Current Vice Chairman Roger W. Ferguson Jr. has continued to serve even though his term expired in January 2000. He was renominated by President Clinton but never received a hearing from the Republican-led Senate Banking Committee. President Bush nominated him again in March, but Senate Banking Committee Chairman Phil Gramm never held a confirmation hearing.
On Monday, Sen. Paul Sarbanes said he would schedule a hearing on the Ferguson nomination as early as next week. The Maryland legislator will take the reins of Senate Banking today after control of the chamber shifts to the Democrats as a result of the defection of Vermont's James Jeffords from the Republican party two weeks ago.
The Bush administration has not yet nominated anyone to fill the vacant board seats, but a number of names have arisen as potential candidates. Among them are Terry J. Jorde, president and chief executive officer of $35.6 million-asset CountryBank USA in Cando, N.D., and Gay Wisbey, director of markets and exchanges for the United Kingdom's Financial Services Authority. Both women have reportedly been interviewed by administration officials for financial services policy posts.
Another name that surfaced Monday is Alfonso Martinez-Fonts Jr., chairman and chief executive officer of J.P. Morgan Chase Bank of Texas in El Paso. He could not be reached for comment.
Mr. Kelley, whose term runs through January 2004, did not characterize his pending resignation as a "retirement." Though he said he has no immediate plans, he would not rule out a return to public life in a job that does not require a full-time commitment. "I do not intend to fold up and disappear from life."
He said he plans to divide his time between Washington and Houston, where he pursued a nearly 30-year business career before joining the Fed.
Mr. Kelley underwent a balloon angioplasty after experiencing chest pains in February 2000, but a Fed spokesman said health concerns had nothing to do with the decision.
"Governor Kelley is a man of the highest principle," Mr. Greenspan said in a press statement released Monday. "I will miss his wise counsel. In his 14 years on the board, he has given more than sound judgment and hard work; he has given us the gift of his friendship."