President of Fed Bank of New York resigns Corrigan will leave powerful post in Aug.

January 06, 1993|By Bloomberg Business News

NEW YORK -- E. Gerald Corrigan, president of the Federa Reserve Bank of New York, called a news conference yesterday and resigned, effective Aug. 20, his 25th anniversary with the Fed.

"It's a tough job -- a very tough job," said Mr. Corrigan, a plain-speaking, chain-smoking 51-year-old protege of Paul A. Volcker, the former chairman of the Federal Reserve Board. "People say, 'You're never going to quit,' " he said. "I'm going to do it."

The head of the New York Fed, widely regarded as the second-most-powerful job in the Federal Reserve System, after the chairmanship, pays about $250,000 a year. The New York Fed president maintains a permanent seat on the Fed's policy-making committee and oversees the Fed's transactions in the securities markets.

Mr. Corrigan is considered to be the Fed official most familiar with the mechanics of banking and securities transactions.

A terse phone call from Mr. Corrigan reportedly prompted the resignation of John Gutfreund, former chief executive of Salomon Inc., after the firm's securities unit admitted violating rules on U.S. Treasury auctions in 1991.

"His whole life has been in" government, and he had "frustrations to go along with the challenges," said Mr. Volcker, now chairman of James D. Wolfensohn & Inc., a New York-based investment bank. Mr. Corrigan has "an ability to get things done, which you don't often find," Mr. Volcker said.

Mr. Corrigan, a native of Waterbury, Conn., said he was giving up his job to "find myself" by trout fishing in Montana, where he recently bought a condominium. He dismissed speculation that he is interested in working for the Clinton administration or in replacing Alan Greenspan as Fed chairman when Mr. Greenspan's term expires in 1996.

Mr. Corrigan also dismissed suggestions that his resignation is related to health problems, policy squabbles within the Fed or dissatisfaction with the Clinton administration. "Let me emphasize, what you see is what you get," Mr. Corrigan said.

"There is no hidden story, no hidden agenda."

A replacement for Mr. Corrigan is expected to be named by July 1 or sooner, by a committee of New York Fed board members.

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