Chancellor Alistair Darling has outlined plans to give the Bank of England new responsibilities in his Mansion House speech.

Speaking in his first keynote address to City chiefs, the chancellor said the Bank will now also be accountable for the UK's financial stability.

This is in addition to its statutory objective of setting interest rates.

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Part of the reforms will include setting up a new Financial Stability Committee, which will guide the Bank's operations in this field.

"It will bring valuable, external expertise with City experience to bear on the Bank's decision making," he said.

"The challenge for us is to ensure that the authorities can act quickly and decisively where necessary to support financial institutions," Mr Darling added.

More details will come in a letter to the chairman of the Treasury Select Committee on Thursday.

The speech was criticised by the Conservative party.

Shadow chief secretary to the Treasury Philip Hammond called it a "missed opportunity".

"Gordon Brown's reputation for economic competence has gone bust and this was the big test of whether the Chancellor had the vision to steer Britain's economy through these difficult times," he said.

"What Britain needed from the Mansion House speech was a display of economic leadership. Instead all we got were re-hashed announcements and no new ideas."

(BBC)

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