William C. Dudley, President and CEO of the Federal Reserve Bank of New York, announced his impending resignation today. Dudley, who had headed the bank since 2009, says he will step down in mid-2018. His term would have extended through January 2019, but with this announcement, the search is on for a replacement. This news comes on the heels of President Trump’s nomination last week of Jerome Powell as Fed Chair. Powell will succeed current Fed Chair Janet Yellen after her term is up in February 2018.
Dudley was a key figure in helping stabilize the nation in the aftermath of the 2008 financial crisis, and his conservative approach made him a natural ally of Yellen. However, CNBC reports that Dudley had previously told several colleagues he planned to step down in 2018, and that his decision was unrelated to President Trump’s nomination of Powell.
In his announcement, Dudley said:
I would especially thank Tim Geithner, Ben Bernanke and Janet Yellen for giving me the opportunity to work closely with them during the crisis and the subsequent economic recovery. … I have every confidence in the institution, its leadership and staff, and know that well after I leave, the New York Fed, as a critical part of the Federal Reserve System, will continue to contribute strongly to the nation’s well-being.
Yellen said, “The American economy is stronger and the financial system safer because of [Dudley’s] many thoughtful contributions. The Federal Reserve System and the country owe him a debt of gratitude.”
Dudley’s departure is just the latest shakeup in what has been a tumultuous couple of months for the Fed. In addition to Powell taking over from Yellen, Stanley Fischer, Vice Chairman of the Fed, submitted his resignation this past October. In addition, the fed’s seven-member Board of Governors currently has three open seats.
Powell’s nomination marked a break with tradition, which typically sees Fed chairs continue on to a second term. Dudley’s resignation also stands out, as a mid-term departure is rare. He began his first full term as Fed president in 2011, and was reappointed in 2016.
The search committee for a new Fed president will be headed by Sara Horowitz, chair of the New York Fed’s Board of Directors, and Glenn Hutchins, co-founder of North Island and of Silver Lake. Executive search firms Spencer Stuart and Bridge Partners have also signed on to help find a suitable candidate.