The Chancellor of the Exchequer has today announced the re-appointment of Martin Taylor and Donald Kohn as external members of the Bank of England’s Financial Policy Committee (FPC). He has also extended Professor David Miles’ second term as external member of the Bank’s Monetary Policy Committee (MPC).
Martin Taylor and Donald Kohn’s first terms on the FPC will both expire on 31 March 2015. Their second terms will begin on 1 April 2015, and expire on 31 March 2018. David Miles was appointed to the MPC in June 2009.
His second and final term was due to end on 31 May 2015 but has been extended by three months to 31 August 2015.
The Chancellor George Osborne said:
Martin and Don have made a tremendous contribution to the work of the Financial Policy Committee (FPC) during their current terms. Their knowledge and expertise have proved invaluable to establishing the FPC as an effective and credible macroprudential policy-making body. David’s economic expertise has been a credit to the Monetary Policy Committee (MPC) especially his interest in, and work on QE and the financial and housing markets.
I’m pleased that Martin and Don will continue on the FPC for a further term, and am confident that they will continue their good work in helping the FPC ensure emerging risks and vulnerabilities across the financial system as a whole are identified, monitored and effectively addressed. I am grateful to David for agreeing to extend his term on the MPC which will allow for a full MPC membership going into the next Parliament.
Martin Taylor joined the FPC as an external member on 1 April 2013 when the Committee was established. He is Vice-Chairman of the Board of RTL Group. He was formerly chairman of Syngenta AG and was a member of the Independent Commission on Banking chaired by Sir John Vickers. In a career spanning the worlds of finance, industry, public policy, and journalism, he has been chairman of WH Smith plc (1999-2003), Chief Executive Officer of Barclays plc (1993-98) and Courtaulds Textiles (1990-93). From 1999-2005 he was an adviser to Goldman Sachs International.
Donald Kohn joined the FPC as an external member on 1 April 2013 when the Committee was established. Prior to that he served as an external member of the interim FPC, which was established to undertake the role of the statutory Committee, as far as possible, ahead of the Financial Services Act 2012 coming into force.
As the former vice chairman of the Federal Reserve, Donald Kohn is an expert on monetary policy, financial regulation and macroeconomics. He retired from the Board of Governors in 2010. Prior to taking office as a member of the Board of Governors of the Federal Reserve in 2002, he was an adviser to the board for bonetary policy from 2001 to 2002, secretary of the Federal Open Market Committee from 1987 to 2002, director of the division of monetary affairs from 1987 to 2001, and deputy staff director for monetary and financial policy from 1983 to 1987. He also held several positions in the board’s division of research and statistics: associate director from 1981 to 1983, chief of capital markets from 1978 to 1981, and economist from 1975 to 1978.
The FPC was established on 1 April 2013 by the Financial Services Act 2012, and is a vital part of the government’s new system of financial regulation. The FPC is the UK’s macroprudential regulator: its objective is to protect and enhance the stability of the UK’s financial system by identifying, monitoring and addressing systemic risks. The FPC works with the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) to address risks to the system as a whole, while the PRA and FCA have responsibility for microprudential and conduct regulation of individual firms, respectively.
The Bank of England Act 1998 (as amended by the Financial Services Act 2012) made provision for the initial appointments to the committee to be for a period of less than the normal three years and for shortened terms to be discounted from the two term limit for external members. As Martin and Donald were appointed for shortened terms, they will be eligible for reappointment when their new terms expire.
David Miles is a Professor at Imperial College, London, and previously was head of their financial economics department. David was chief UK economist at Morgan Stanley from 2004 to 2009. He has also provided advice to the Treasury Select Committee as a specialist economist and at Budget 2003, was commissioned by the then Chancellor to lead a review of the UK mortgage market.
David was appointed to the MPC in June 2009. He was the first member of the committee to be reappointed under the new appointments process outlined in the amendments to the 1998 Bank of England act brought in by the Banking Act 2009. This amendment restricted external members of the MPC to a maximum of two three-year terms.