UK names financial policymakers, sketches framework

* UK appoints Kohn, Cohrs, Lambert and Clark to new FPC

* UK says FPC must not hamper banks’ contribution to growth

* New consumer protection body to have power to ban products

(Adds context, Hoban quote)

By Matt Falloon

LONDON, Feb 17 (Reuters) – The British government named four external members of the Bank of England’s new Financial Policy Committee on Thursday, and fleshed out more detail on how it will overhaul UK financial regulation in the coming years.

The Conservative-Liberal Democrat coalition government, in power since May, is beefing up the role of the central bank to give it more power to maintain a stable financial system as part of measures to try to avoid another credit crisis. Former U.S. Federal Reserve Vice Chairman Donald Kohn, ex-Goldman Sachs and Deutsche Bank banker Michael Cohrs, former BoE monetary policymaker Richard Lambert and ex-BoE executive Alastair Clark will join the FPC as external members, the Treasury said.

“Today’s announcements are a crucial milestone in implementing the government’s plans for fundamental reform of financial regulation,” Treasury minister Mark Hoban said.

The FPC, headed up by BoE Governor Mervyn King and including other executives from the central bank and the soon to be extinct Financial Services Authority, is being set up as a macroprudential counterpart to the BoE’s Monetary Policy Committee.

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