Belfast Telegraph

Wednesday 30 July 2014

Trail of e-mails highlights Tucker's concern over Barclays financing

A batch of 'critical' e-mails sent from the Bank of England deputy governor Paul Tucker to former Barclays boss Bob Diamond have been released.

The correspondence appears to provide further evidence of Mr Tucker's concerns over Barclays financial health when the bank was accused of manipulating Libor.

In one e-mail, Mr Tucker said he was "struck" that Barclays had issued a government-guaranteed bond with a high yield, which could be a sign that Barclays was struggling to secure funding. "That's a lot," Mr Tucker added.

Mr Diamond last week released a note of a phonecall with Mr Tucker which ultimately led to the Bank lowering its Libor submissions.

Treasury Select Committee member John Mann MP said the messages were "critical" and accused the Bank of stalling in handing them over. Another e-mail exchange disclosed by Mr Mann confirms Sir Jeremy Heywood, the then Downing Street chief of staff, raised concerns over the high rate of Libor submissions in the UK, compared to the US.

Sir Jeremy forwarded a note from UBS to Mr Tucker, in which the Swiss bank advocated "speeding up" the gradual decline in the interbank lending rate in the emails sent in late October 2008.

In the phone call disclosed by Mr Diamond, Mr Tucker relayed concerns by "senior Whitehall figures" that Barclays' Libor rates were higher than other banks.

The American banker said Mr Tucker did not reveal who the Whitehall figures were, but he took them to be "officials within the Government".

Mr Diamond, who resigned with immediate effect last Tuesday, told MPs he was left "confused" by the contentious phone call with Mr Tucker.

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