Co-ordinating committee chairman Rory Mair said: 'The publication today of the latest report of the select committee clearly shows that there is a substantial case for compensation for those depositors who lost money in the closure of BCCI.
'The original select committee report clearly stated that, in the case of local authorities, compensation should be considered if the Bank of England was shown to have failed to discharge its supervisory duties.
'On 19 July 1991 the Chancellor of the Exchequer said in the House: 'On the question of what the implications would be if maladministration were found or criticisms were made, I have to say to the House that I have no reason to think that the Bank of England has not discharged its role and duty properly and competently. If other evidence came to light, I would then have to consider the implications of that'.
'If the government wishes to retain any credibility in this matter, it has no option but to accept the logical consequences of the select committee report and enter discussions with the local authorities on the question of compensation. We will be pressing the government to do this as quickly as possible'.