WASHINGTON (AP) Federal Reserve Governor Edward W. Kelley Jr. said Monday he would step down from the Fed's seven-member board as soon as one of two current vacancies is filled.
Kelley, who has served on the Fed's board of governors for 14 years, longer than any other current member, said he wanted to ''focus on family and other interests.''
The Fed has been operating with only five members since July 1999. The quorum for most deliberations is four governors, but some activities require five.
Kelley, appointed by President Reagan, joined the board in May 1987, three months before Chairman Alan Greenspan. He enjoyed a close working relationship with Greenspan and generally has followed the chairman's lead in monetary policy decisions. In 14 years, he dissented from Greenspan's majority position only twice.
While President Bush will now have the chance to fill three of the seven seats on the Fed's board, private economists said they were not looking for any basic changes in the handling of interest rate issues as long as Greenspan remains chairman.
Kelley, 69, said in an interview that he made the decision about a year ago to step down before his current term ends in 2004.
''I have given my single, undivided attention to this institution for 14 years and I felt it was time to move on,'' said Kelley, the only non-economist currently serving on the Fed board.
He said he and his wife plan to split their time between Washington and Houston, where Kelley had been the successful president of Kelley Industries, a holding company with subsidiaries in manufacturing, distribution and business services.
Kelley said his proudest achievement at the Fed was heading up the central bank's task force that made sure the banking system was prepared for the Year 2000 computer calendar change.
Former President Clinton's efforts to fill vacancies on the Fed board last year were blocked by Senate Banking Committee Chairman Phil Gramm, R-Texas, who said that the positions, with 14-year terms, should not be filled by a lame duck administration.
The Fed's board of governors handles supervision of national banks and participates with 12 Fed regional bank presidents in making interest rate decisions.