Well before the Federal Reserve Bank of Atlanta named Raphael Bostic as its new president last week, pressure had been mounting for the Fed to use the vacated spot as an opportunity to diversify its ranks. And for good reason: Until then, in the Fed’s 103-year history, there had never been a black or Latino president at any of its 12 regional banks. In fact, until 2009, when Narayana Kocherlakota took the helm at the Federal Reserve Bank of Minneapolis, all of the Fed’s regional-bank presidents had been white.
The lack of diversity isn’t just in the top offices of these regional institutions; according to Fed data, 82 percent of its senior employees are white.This hasn’t gone unnoticed. Last year, Senator Elizabeth Warren brought the issue to the attention of Fed Chairwoman Janet Yellen (the first woman to ever hold that position) in a letter that asked why Fed has remained so homogenous. The Brookings Institution noted the lack of diversity in an op-ed by Aaron Klein last year, saying, “There is strong data to support the claim that the regional Federal Reserve Banks have structural problems in generating diverse leadership and that the lack of diverse leaders has negative repercussions.” And at Cato Institute, Mark Calabria wrote that “the Fed has increasingly over time come to look less and less like the rest of America” in terms of background and education. Yellen herself has spoken out about the need for a more diverse Fed system, saying in testimony before the House Financial Services Committee that the issue was a “key priority.”