Lord King gets drawn into the Co-op affair

David Hellier
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FORMER Bank of England governor Lord Mervyn King may be asked to give evidence to the Treasury Select Committee investigating the collapse of the Co-op’s purchase of Lloyds Bank branches, after claims he told a rival bidder its bid would get nowhere.

Lord Levene has said that Lord King invited him to the Bank to advise him his bid for the Lloyds branches would not succeed. “You’re not going to get this,” Lord Levene said Lord King told him. “This is a political decision.”

Lord King, who is lecturing in New York, will be expected to co-operate with the inquiry although he is said to be keen to maintain a low profile generally. Lord King may be asked to attend the in person or to provide written evidence. “We’ll probably wait until we’ve heard from Lord Levene. We’ve got regulators and advisers to hear from first,” a source said.

Chancellor George Osborne has been criticised for supporting the Co-op bid for the Lloyds branches. Yesterday he hit back. “The key point is that it did not happen, so in other words the system worked because when we saw the Co-op was in no state to take over these branches the alarm bell rang and the alarm bell was heard. That is a massive difference from the past.”