Below are some of the key comments and reactions.

"Northern Rock had only one well from which to drink, and the FSA should have realised that.

"It was a failure of the regulator not to see systemic risk."

"As we have already acknowledged publicly, there were clearly supervisory failings in relation to Northern Rock and we are already addressing these."

"This Labour-dominated Treasury Select Committee accuses the Chancellor of a serious error of judgement over Northern Rock, sets out yet more evidence of damaging dithering and attacks his lack of leadership.

Thanks to his economic incompetence over Northern Rock, Alistair Darling's credibility is in shreds."

"The big issue which neither the government nor this committee has grasped, is how do you deal with this problem where you have a kind of reckless build up of bank lending?

"You know, pumping up the housing market leading in turn to a crash, which may well be upon us. How do you stop this kind of reckless behaviour?

"And in order to do that you really do need to have a regulator who is treating the banks rather more carefully. Not allowing them to behave like casinos and exercising effective supervision."

"Nobody knew back in September when the Northern Rock got into difficulty who was really in charge.

"We've had this Northern Rock farce going on for five months now while people have dithered and delayed."

"Certainly as far as the industry is concerned, when the problems arose, clearly our authorities did unfortunately drop the ball.

"But I think the most important thing now is not really to look at what did happen but what we need to do next.