BANKING AND FINANCE

Bill Would Change How Interest Rate Policy Is Set: Sen. Paul S. Sarbanes (D-Md.), chairman of the Joint Economic Committee, and Rep. Lee H. Hamilton (D-Ind.), the vice chairman, have introduced legislation to change the way that the Federal Reserve develops interest rate policies. The change is aimed at making policy-makers more accountable to the Fed chairman. Five of the Fed’s 12 regional bank presidents serve at any one time as voting members of the 12-member Federal Open Market Committee, the panel that sets rate policies. The bill would leave monetary policy solely in the hands of the Fed’s seven-member board of governors.