Belfast Telegraph

Monday 22 September 2014

Ex-chief in showdown with MPs after shock resignation

Bob Diamond is set for a showdown with MPs today following his shock resignation as Barclays chief executive in the wake of the Libor rate-rigging scandal.

Mr Diamond and right-hand man Jerry del Missier quit with immediate effect as the storm surrounding interbank lending closed in on the Bank of England.

Ahead of his appearance before the Treasury Select Committee today, Mr Diamond revealed details of a phonecall he had with BoE deputy governor Paul Tucker that ultimately led to some staff attempting to fix the so-called Libor.

Barclays said Mr Diamond's account of the conversation was wrongly interpreted by Mr del Missier, then at Barclays Capital, as an instruction to lower the bank's Libor submissions.

Barclays has submitted a copy of a note, sent from Mr Diamond on October 30, 2008, to Mr del Missier, and then chief executive John Varley, recounting his conversation with Paul Tucker, to the Select Committee.

Mr Diamond said Mr Tucker had flagged concerns from senior figures in Whitehall over why Barclays was always towards the top end of Libor pricing.

Mr Diamond wrote: "His (Mr Tucker's) response was 'you have to pay what you have to pay'."

Mr Diamond said he asked Mr Tucker to explain to his Whitehall contacts that other banks were providing Libor quotes that did not represent real transactions.

The banker then said Mr Tucker told him the bank's Libor rate did not "always" need to appear as high as it had recently.

Barclays added: "Subsequent to the call, Bob Diamond relayed the contents of the conversation to Jerry del Missier.

"Bob Diamond did not believe he received an instruction from Paul Tucker or that he gave an instruction to Jerry del Missier.

"However, Jerry del Missier concluded that an instruction had been passed down from the Bank of England not to keep Libors so high and he therefore passed down a direction to that effect to the submitters."

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