Bank's Bean at parliament committee

LONDON (Reuters) - Below are highlights from new Bank of England Deputy Governor Charlie Bean's "confirmation" hearing before parliament's Treasury Committee on Wednesday.

Bean, formerly the Bank's chief economist, took over from Rachel Lomax as deputy governor on July 1.

Below are highlights from the session:

"There is no doubt that the UK economy presently faces the most challenging set of circumstances since at least the early 1990s and possibly earlier.

"We are faced with two substantial shocks of unknown impact and duration: the de-leveraging that is underway in financial markets and the associated tightening in the availability of credit; and the relentless rise in oil and other commodity prices.

"Both these shocks depress activity, but have conflicting effects on inflation."

"Meeting the Chancellor's inflation target, whilst simultaneously avoiding undue volatility in output, will be no easy task. So ensuring that the MPC gets the best possible analysis and intelligence from both the Monetary Analysis and Statistics, and Markets directorates, will be my number one objective."

ON DOWNSIDE RISKS

"On the downside, the dislocation in financial markets probably has further to run, especially if a slowing economy here and abroad generates a second round of write-downs, this time associated with corporate loans.