SEOUL, July 26 (Reuters) - The Korea Federation of Banks on Tuesday named a pro-government economist who helped the new administration brainstorm financial policies to the board of the central bank, as the Bank of Korea continues policy tightening to quell inflation.

Shin Sung-hwan, a veteran economist and management school professor at Hongik University in Seoul, is expected to join the Bank of Korea's seven-member board to replace Lim Ji-won, whose term as a board member ended recently. Shin will be formally appointed by President Yoon Suk-yeol.

The announcement comes as the central bank is set to deliver more interest rate hikes in the weeks ahead.

The central bank has raised rates a total of 125 basis point since mid-last year, as Governor Rhee Chang-yong emphasised the importance of prioritising the fight against inflation.

The seven board members including Shin will also be reviewing the pace of policy tightening towards the end of this year, as the country's trade deficit has ballooned to a record while business activity is slowing.

Shin, a graduate of the Seoul National University with a Ph. D. in finance from the Massachusetts Institute of Technology, has been a professor at Hongik University for more than two decades.

He has been critical of real estate and other economic policies of the former administration of Moon Jae-in, and has advised the Yoon government to deregulate rules to spur corporate investment and boost growth.

"Having a board member who has formerly served on the Yoon government's presidential transition committee means the government could eventually have more say on (monetary policy)," a local fixed-income dealer said.

"This could be meaningful for the board to have a pro-government voice, especially as policy priorities could change from inflation to managing growth risks."

(Editing by Jacqueline Wong)