What Is the Federal Reserve Board (FRB)?

The Board of Governors of the Federal Reserve System, also known as the Federal Reserve Board (FRB), is the governing body of the Federal Reserve System. The FRB was established by the Banking Act of 1935. The members are statutorily tasked with giving a “fair representation of the financial, agricultural, industrial, and commercial interests and geographical divisions of the country.”

How the Federal Reserve Board (FRB) Works

The Board of Governors of the Federal Reserve System called the Federal Reserve Board or FRB for short, is a seven-member body that governs the Federal Reserve System, the U.S. central bank in charge of making the country's monetary policy.

The members of the U.S. Senate-confirmed FRB are considered an independent agency of the federal government. The Fed has a statutory mandate to maximum employment and stable prices at moderate long-term interest rates, and the FRB chair and other officials frequently testify before Congress. However, it makes monetary policy independently of the legislative or executive branches and is structured like a private corporation.

Appointments, Terms, and Roles

The president appoints the FRB's members, and they are confirmed by the Senate. Each is appointed to a single 14-year term but may serve shorter or longer periods. A new board member serves the remainder of the outgoing member's term if any. The new member may then be reappointed to one full term.

If a replacement has not been confirmed when that term expires, they may continue to serve, so that it is possible for a member to serve for much longer than 14 years. However, the President is allowed to remove a member from the board, given sufficient cause. Terms are staggered so that a new one begins every two years. Once appointed, each board member operates independently.

The chair and vice-chair for the supervision of the Federal Reserve Board are appointed to four-year terms by the president from among the board's existing members. They can be reappointed to these leadership roles as many times as their term limits as board members allow. 

The board of governors includes several subcommittees with their chairs and vice-chairs. These are the committees on board affairs; consumer and community affairs; economic and monetary affairs; financial stability; Federal Reserve Bank affairs; supervision and regulation; payments, clearing, and settlement; and the subcommittee on smaller regional and community banking. 

Here is the current list of Federal Reserve Board members:

Current Federal Reserve Board
Jerome H. Powell (Chair)
Philip N. Jefferson (Vice Chair)
Michael S. Barr (Vice Chair for Supervision)
Michelle W. Bowman
Lisa D. Cook
Adriana D. Kugler
Christopher J. Waller

Duties of the Federal Reserve Board (FRB)

The Federal Reserve Board members' most important role is as members of the Federal Open Market Committee (FOMC), which is in charge of the open market operations that determine the federal funds rate, one of the global economy's most important benchmark interest rates. In addition to the seven governors, the FOMC consists of the president of the Federal Reserve Bank of New York and a rotating set of four other branch presidents. The chair of the FRB also chairs the FOMC.

The FRB is directly in charge of two other monetary policy tools, the discount rate (based on suggestions from the regional branches) and reserve requirements. It is also tasked with supervising the Fed's 12 regional branches.

Administration of the Federal Reserve Board Officers

The Board's principal offices are located in the District of Columbia. At Board meetings, the chairman presides, and in the chairman's absence, the vice chairman takes over. If both the chairman and vice chairman are absent, the Board can elect a member to act as chairman pro tempore.

Funds collected through assessments on Federal Reserve banks are used to cover expenses and salaries of Board members. Board members are prohibited from holding positions or stock in banks, banking institutions, or trust companies. Each board member must certify this fact under oath as part of their service.

The Bottom Line

The Federal Reserve Board, commonly known as the Fed, is the central banking system of the United States. Its primary mission is to control monetary policy to promote stable prices, sustainable economic growth, and full employment. The Federal Reserve Board uses various tools including adjusting interest rates and conducting open market operations to influence the money supply and influence the broader economy.

Correction—Jan. 31, 2023: A previous version of this article incorrectly listed the Federal Reserve Board as a "non-governmental agency." While independent, the FRB is an agency of the federal government.