HIGHLIGHTS-Carney speaks after Bank of England cuts rates, restarts QE

LONDON, Aug 4 (Reuters) - Bank of England Governor Mark Carney and other members of the Monetary Policy Committee gave a news conference on Thursday after the Bank cut rates for the first time since 2009 and said it would buy 60 billion pounds of government debt to ease the blow from the Brexit vote on June 23.

Below are highlights of their remarks.

CARNEY ANSWERS TO QUESTIONS FROM REPORTERS:

INSTITUTIONAL SAVERS MOVING INTO RISKIER ASSETS

There's a difference between individual savers and institutional savers - the pension funds, the insurance companies. What we do see for those bigger institutional savers are the moves into riskier assets: longer dated government debt, into corporate debt if they had government debt, into equities if they had corporate debt, from equities into hard assets and on and on.

MEASURES WILL MAKE BREXIT MORE LIKELY TO BE A SUCCESS

This is the appropriate response to the economic considerations we find ourselves in ... This will support Brexit and make it more likely to be a success.

CLEAR CASE FOR STIMULUS NOW

We are seeing these risks manifest in a wide variety of indicators -- indicators which in many cases are better indicators of what is actually happening in the economy, rather than what we call hard data -- so there is a clear case for stimulus, and stimulus now, in order to have an effect when the economy really needs it.

THIS IS ABOUT CUSHIONING THE SHOCK

So this is about cushioning the shock, supporting the adjustment, taking uncertainty off the table and ultimately making this a success.

CHANCELLOR FULLY INFORMED ON BOE THINKING

The Chancellor himself knows, whoever he or she is, the broad outlines of an MPC (KOSDAQ: 050540.KQ - news) decision prior to that decision and of course in the case of this decision where there's an indemnity being given for the asset purchase facility. We had extensive discussions on the possible decisions of the MPC so we're fully aligned, fully informed in terms of the MPC's thinking and the broader Bank's thinking about what we can do to support this adjustment process.

TERM FUNDING SCHEME CAREFULLY CALIBRATED

We have very carefully calibrated the pricing the sizing of the TFS (Dusseldorf: UFW.DU - news) to neutralise this effect, so in aggregate there is no reward for the banks and there is no penalty for the banks, what there is is a facility that ensures they can fully pass through the cut in bank rate to their customers.

TRANSMISSION OF BANK RATE CUTS TO REAL ECONOMY

This is really about the transmission of those bank rate cuts to the real economy as opposed to a scheme to incentivise certain amount of lending; that was the old FLS, this is designed for a different purpose.

NEGATIVE INTEREST RATES

As you might have gathered ... I am not a fan of negative interest rates. We see the negative cosequences through the financial system and we see them in other jurisdictions.

We have other options to provide stimulus if more stimulus is needed, so we don't need to go to that as a last resort, so we are very clear that we see the effective lower bound for interest rates as a positive number.

No, on the negative interest rates conversation, I don't see a scenario for that. I think I've been about as clear as I can be on that. Just write whatever you want to take that off the table from me. I'm not trying to be clever in the way I'm answering that question.

BANKS HAVE NO EXCUSE NOT TO PASS ON RATE CUT TO CUSTOMERS

The banks have no excuse, with today's announcement, not to pass on cut in bank rate and they should write to their customers and make that point.

MONETARY POLICY NIMBLE

Monetary policy is more nimble and it's appropriate that it's the first responder to a shock.

BIGGEST ISSUES FOR GOVERNMENT: BREXIT, PRODUCTIVITY

The biggest issues for government are those that they've acknowledged, which is the importance of the negotiations with European allies on the new relationship that will be developed, the importance of having a comprehensive productivity plan for the country, and it is within that context or its is those decisions and those policies which will really be the determinants of the long-term prosperity.

ACCESS TO CREDIT

Businesses and households, anyone watching, if you have a viable business idea, if you qualify for a mortgage, you should be able to get access to credit. This is not 2008, '09, '10, '11, '12, '13 and half of '14. It's a different world. But that's enough in people's memories that it's important to take that off the table.

SAVERS

With (Other OTC: WWTH - news) respect to savers, this is something that we think about a lot as a group of people who have worked hard, absolutely done the right thing, set money aside and the returns are very low and tehy're likely to be low for some time. That's true in the UK, it's true in all advanced economies.

BEN BROADBENT, DEPUTY GOVERNOR, IN RESPONSE TO QUESTIONS:

SURVEYS SUGGEST ECONOMY CONTRACTING

This is one of the more reliable indicators of activity, the CIPS surveys, we've weighted the sectors here into one single series, or rather two, one for output, one for expectations. These are the steepest falls in both those series we've ever had and they're both of them at levels we haven't seen since early 2009. They are reliable indicators, these and a few other surveys and I would point out that if you took them at face value they would suggest that the economy is actually contracting.

NOT PREMATURE TO ACT NOW

We would need to recover in the coming months to meet the forecasts we have which is for a little bit of growth during the second half of the year so I don't think it's premature to have acted in the face of weakening in these output surveys, weakening employment surveys, steep falls in some of the investment and tensions against a backdrop of which investment was already falling and also pretty steep falls in indicators of housing market activity.

EXCERPTS FROM CARNEY'S OPENING STATEMENT:

The decision to leave the European Union marks a regime change. In the coming years the UK will redefine its openness to the movements of goods, services, people and capital.

Some of the adjustments to this new reality may prove difficult, and many will take time, but the UK can handle change.

To be clear, the future potential of this economy and its implications for jobs, real wages and wealth are not the gifts of monetary policymakers. We cannot immediately or fully offset the economic impacts of a large structural shock.

We took these steps because the economic outlook has changed markedly, with the largest revision to our GDP forecast since the MPC was formed almost two decades ago.

By acting early and comprehensively, the MPC can reduce uncertainty, bolster confidence, blunt the slowdown, and support the necessary adjustments in the UK economy.

The degree and composition of stimulus is largely determined by the effects of the vote to leave the EU on demand, supply and the exchange rate.

Beginning with demand, the 9 percent depreciation of sterling since the referendum will boost exports and weigh on imports. However, even though the MPC expects the current account deficit to halve over the next three years, improvements in the external sector are not expected to offset fully the drag from substantially weaker private domestic demand.

The MPC expects supply growth to remain well below past average rates throughout the forecast period.

The fall in sterling will push up on import and consumer prices notably over the next three years.

Around half of mortgagors have floating rate contracts and more than four-fifths of bank loans held by firms are at floating rates; lower interest rates will be felt immediately in the economy.

The MPC is determined that the stimulus the economy needs does not get diluted as it passes through the financial system.

All of the elements in this package have scope to be increased. The MPC can lower the Bank Rate, increase the size of the TFS, and expand the scale or variety of assets held in the Asset Purchase Facility.

(Reporting by Sarah Young, Paul Sandle and Elisabeth O'Leary, compiled by Estelle Shirbon)