Senior members of the US Senate’s banking committee on Thursday rebuked the Federal Reserve for its handling of the rescue of AIG, warning its failure to reveal how the $163bn injected into the group has been spent could prompt Congress to block further financial sector bail-outs.

In a tense hearing, Donald Kohn, the US Federal Reserve vice-chairman, said he could not tell lawmakers how much more support AIG might require. Neither could he reveal the names of those of AIG’s counterparties that had been protected from losses.