The former chancellor of the exchequer Lord Lamont of Lerwick is joining the bandwagon of investment funds specialising in impaired debt and distressed companies, as an advisor to a fledgling fund backed mainly by personal and small business insolvency experts.

Lord Lamont, Conservative chancellor in 1992 when Britain was forced to leave the European Ex-change Rate Mechanism, will be appointed to the credit committee of Eternitas investment group, a £20m fund launched in January.