The most powerful woman in Europe?

She's the woman who is giving Britain's bankers sleepless nights. For the last couple of years Neelie Kroes has quietly waived many of her own rules to allow the EU's various member states to pump billions of Euros (and pounds) into their banking systems.

But now, with collapse averted, it's payback time. And having broken up ING – the biggest bank in her native Netherlands – it's Britain's turn. The medicine "Steely Neelie" has in mind for Lloyds Banking Group and Royal Bank of Scotland might prove tougher to swallow than they ever expected.

"She's very approachable and has that typically Dutch informality," said one consultant who is a regular visitor to Brussels. "People often come away thinking they've had a good meeting and got their points across. They tend to underestimate her. They shouldn't."

Ms Kroes, a former Dutch transport minister, was appointed to the Commission in 2004. It was a move that drew some controversy – she has a string of non executive directorships and had faced allegations of impropriety in the past (all denied).

She was also seen as a right winger, having represented the People's Party for Freedom and Democracy. While hardly Thaterchite, it is a political grouping seen as representing businessmen and entrepreneurs, more in favour of free markets than traditional European conservatives usually are.

Those who thought her links to business might make her a soft touch were quickly to be disappointed. She disentangled herself from conflict of interest allegations by stepping aside from issues involving companies with which she has had connections (her predecessor Charlie McCreevy handled the dirty work) while proving willing to launch pre-emptive strikes where she saw misdeeds.

Investigations have been launched into a lack of cross-border competition in energy, banking and pharmaceuticals on this basis. Ms Kroes has seen no need to wait for whistle blowers.

The one area, though, where she has really sought to make her mark has been over the thorny issue of state aid to industry. Until the banking crisis she had taken a tough line but as the credit crunch took hold and dire predictions of meltdown were being made, Ms Kroes loosened the reins. More than 40 rescue packages have been approved on her watch. And quickly as well.

Said one competition lawyer: "On this issue, if not so much elsewhere, she really has got the bureaucrats moving. I can often be waiting up to six and a half years for decisions to be made by her department. But during the banking crisis, things could get signed off in as little as three and a half days."

Ms Kroes has insisted that the "no state aid" principle she believes in has not been swept aside. And with Armageddon seemingly averted, the pigeons are coming home to roost. The break up of ING could be seen as putting a marker down. Northern Rock's split into a good and bad bank was also accompanied by some tough conditions on the "good" part whose business will face restrictions even under new ownership.

The nickname "Steely Neelie" was derived from a perceived resemblance to a certain former female British prime minister known as "the Iron Lady". Ms Kroes is beginning to prove that she is just as deserving of the title. She does differ from Margaret Thatcher in one important respect, however. The latter might have been Britain's first female prime minister, but she gave short shrift to the idea that she should give other women a leg up. Quite the reverse.

On this issue, however, Ms Kroes has more in common with Harriet "Harperson" Harman. She makes no secret of the fact that she is in favour of positive discrimination and has not been shy about using her influence to ensure more women get into senior positions in her department, regardless of how many feathers this has ruffled in Brussels.

Five of the beneficiaries of her largess even posed for a photo shoot with the clan matriarch in a recent Dutch issue of Marie Claire. It was hardly the sort of pictorial that got the former Europe minister Caroline Flint into such hot water – they wore power suits rather than high-street chic. But it was enough to get them dubbed "Neelie's babes" by one website.

With Brussels preparing to enter a period of transition as a new commission is appointed, Ms Kroes – unlike her colleagues – is no lame duck. The woman who rivals Angela Merkel for the title of "Europe's most powerful" has some important decisions still to make that will have a far-reaching impact on the continent's banking industry for years to come.

Lloyds – with the backing of the British Government – is hoping it can escape from Ms Kroes' claws with barely a scratch. The assets being bandied around as candidates for forced disposal by Lloyds might have gone anyway following the HBoS merger. Will Ms Kroes really be such a soft touch? Don't bank on it.

Who's next in the hotseat ... And who decides?

*European Commissioners are appointed by member states together with the Commission President, who decides their portfolios.

*The Commission (in its entirety) then seeks approval from the European Parliament and the Council of Ministers (via qualified majority voting, which gives the largest nations the biggest say).

*Commissioners nominated for a second term do not usually serve in the same department.

*Neelie Kroes' first term has been extended until Christmas, and it is understood she would like a second. Given the fallout from the banking crisis, her case appears strong.