5 Jul 2012

Diamond: LIBOR emails made me feel "physically ill"

The former Barclays chief executive Bob Diamond has said that he felt “physically ill” when he read incriminating emails relating to the LIBOR-fixing scandal at the bank

Giving evidence to the Treasury Committee yesterday Diamond, who resigned on Tuesday, said the behaviour of those responsible was “reprehensible.”

MPS questioning the former banking chief expressed some scepticism when he said he did not know the true extent of the rate-rigging at the bank until a month ago. Andrew Tyrie, chair of the Committee, said some of what the banker said was "implausible".

Diamond said he "loved Barclays” and had that he was "sorry, disappointed and angry."

Rating agency Moody's has downgraded its rating for Barclays this morning from stable to negative.The agency said shareholder and political pressure was creating uncertainty about the bank's future, and could force it away from investment banking.

MPs will vote later on whether to have a judge-led inquiry over the scandal, favoured by the opposition, or a parliamentary one, favoured by ministers.

Moody's said pressure on the bank could force it to move away from investment banking.

The Bank of England's deputy governor, Paul Tucker, is to give evidence to the Treasury Committee some time next week. Marcus Agius, chairman of Barclays, who announced on Monday he was resigning is to stay on pending the appointment of a new chief executive. His appearance in from of the Treasury Committee has been postponed.

Barclays' chief operating officer Jerry del Missier also resigned on Tuesday in a tumultuous week for the bank.

Barclays was fined a record amount by the Financial Services Authority for over the Libor rate-setting scandal, and the Serious Fraud Office is still considering making criminal charges at the bank. In total Barclays paid £290m to settle an investigation by UK and US regulators over the bank’s involvement in manipulating key interbank lending rates.


Helen Roxburgh