MPs have questioned the fitness of former London Stock Exchange chief executive Clara Furse to sit on the Bank of England (BoE)'s new stability arm.
Furse was interrogated by members of the Treasury select committee (TSC), who raised doubts over her independence, qualifications and fitness to join the BoE's new Financial Policy Committee (FPC) in a hearing yesterday, according to reports.
Furse was criticised particularly for her prior service on the risk and capital committee of failed bank Fortis, which collapsed after its acquisition of ABN Amro assets in 2007, and her lack of enthusiasm for tighter leverage caps for banks.
Conservative MP Jesse Norman called her performance "amazingly unimpressive" and said he may not support her appointment to the new watchdog, whose role it will be to disarm threats to UK financial stability and growth.
He said: "As matters stand, I will be thinking very seriously about whether I can possibly support this nomination."
Labour MP George Mudie questioned Furse's written testimony in which she named over-regulating as the main risk to financial stability. He said: "I could list about half a dozen things that I could put higher than regulators getting overzealous."
Furse denied that Fortis had bought a 'bad bank' during the financial crisis, and defended her stance on regulatory power to set bank leverage caps. "It's another tool that we don't need right now," she said.
Furse, Richard Sharp, a former Goldman Sachs banker, and Martin Taylor, a former chief executive of Barclays, were named to the committee by George Osborne. The TSC is due to report on their candidacies on Wednesday.
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