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Boston Fed taps insider to replace Minehan

Economist set to gain role in voting on rates

Eric Rosengren is the longtime Federal Reserve Bank of Boston economist you probably never heard of. Not anymore, after he was named yesterday as the bank's next chief.

"I've had a larger profile within the organization than I've had outside of the organization," Rosengren , a 22-year veteran of the Boston Fed, said in an interview. He will take the reins as its president and chief executive on July 23, replacing 59-year-old Cathy E. Minehan, who will retire after leading the bank since 1994.

"We have a rich tradition here at the Boston Fed for having presidents that are very active in the community," said Rosengren. "I'm going to be reaching out to the business community and community leaders over the course of the summer."

Rosengren, 50 , will take over at a critical time. One of the most important responsibilities of the dozen Federal Reserve Bank heads is voting on whether to raise or lower key interest rates, a power that rotates among groups of Fed presidents annually. This year it's the Boston Fed's turn, and Rosengren will vote at least three times.

Among his other priorities, he said, is closely watching the spate of foreign firms buying US banks and home foreclosures fueled by subprime mortgages.

Minehan and her predecessor, Richard Syron, became visible personalities in Boston's corporate and civic establishment when they were in the post. Minehan's tenure, however, has been tame compared to that of Syron, who oversaw a study that exposed discrimination in mortgage lending.

Rosengren has spent his entire career in the background, rising from a researcher focused on monetary policy and international regulations to a quiet executive whose experience will distinguish him from other Fed presidents, according to those involved with the search.

"He's interesting in that he's focused in on these financial problems and how they affect the real economy. That's something different than all of the other Fed presidents," said Lisa Lynch , a Boston Fed board member who led a search committee that included New England Patriots owner Robert K. Kraft , Harvard Medical School professor Samuel O. Thier , Ronald E. Logue , the chief executive of State Street Corp. , and Henri Termeer , chief executive of Genzyme Corp. The Boston office of executive search firm Korn/Ferry International conducted the search.

Lynch would not disclose how many finalists the committee interviewed but called the national search "exhaustive and expensive."

Currently, Rosengren is the executive vice president in charge of the bank's supervision, regulation, and credit division and its chief discount officer. He began his career at the Boston Fed as an economist in 1985.

A Ridgewood, N.J. , native, he earned a bachelor's degree in economics from Colby College in Waterville, Maine , in 1979 . He worked in Australia for a year before returning to the states and earning a doctorate in economics from the University of Wisconsin at Madison . Rosengren lives in Sharon with his wife, Teruni , and children, Marina and Michael .

In an interview yesterday, Rosengren pointed to his research on monetary policy during what he called the "credit crunch" among banks in the late 1980s and early 1990s and to more recent work on international banking regulation as among the most important work of his career. Having uniform governance of how banks operate is more important than ever given the prevalence of international bank mergers, he said.

"We have some very large foreign banks that are active in this region, so it's important that we understand what other regulators are doing and that we make sure their banks are subject to similar regulation," he said.

Keith Reed can be reached at