A new regulatory body conceived to dampen market enthusiasm has yet to find its feet in straitened times, a Bank of England policymaker said.

The Financial Policy Committee is in charge of taking a broad view of threats to stability -- such as the sale of risky financial instruments and an oversupply of credit -- and then recommending actions.

The European Union and United States have set up similar bodies with a remit to plug a pre-crisis gap when buoyant markets were left largely unsupervised.

FPC member Donald Kohn said conducting so-called macroprudential policy remains challenging and is still in its infancy, particularly when mulling actions in current depressed markets with banks complaining about having to build up buffers even further.

The other side of countercyclical policy -- easing when times become tough -- confronts a different and perhaps more difficult set of challenges, Kohn said in a speech to the U.S. Treasury Dept on December 2 and made available on Wednesday.

FPC meetings have debated whether to allow banks to tap their capital and liquidity buffers as the euro zone debt crisis becomes the single biggest threat facing them and funding becomes scarce.

UK lenders have been forced to build up capital and liquidity buffers far earlier than global rules require but Kohn is cautious.

If conditions do continue to deteriorate substantially, releasing capital and liquidity buffers -- lowering requirements -- could come back to haunt the economy and the authorities... Kohn said.

A risk averse, or even a risk neutral, macroprudential regulator will find it more comfortable to take away the punch bowl in good times than to spike it in bad times. We need more thought and research about appropriate countercyclical policies in tough times, Kohn said.

Fellow FPC member, Hector Sants, who is chief executive of the Financial Services Authority which regulates banks, said at last week's press conference by the committee that the FSA does not impose binding liquidity rules.

Sants said that, within the current difficult market conditions, banks have a buffer which they can utilise.

(Reporting by Huw Jones; Editing by Mike Nesbit)