Feb. 3 (Bloomberg) -- Chancellor of the Exchequer Alistair Darling said the British government remains open to creating a “bad bank” to buy toxic assets held by banks.

“There is whole question how you deal with toxic assets,” Darling told the House of Lords Economic Affairs Committee in London today. “We have set up an insurance scheme and we have certainly not closed the door on a bad bank scheme. You do need to look at a range of options.”

To contact the reporter on this story: Gonzalo Vina in London at gvina@bloomberg.net

Last Updated: February 3, 2009 11:37 EST