Barclays CEO resigns as the Libor rate fixing scandal widens
UK Barclays chief executive Bob Diamond suddenly quit on Tuesday over an interest rate-rigging scandal that threatens to drag in a dozen more major lenders but suggested the Bank of England had encouraged his bank to manipulate the figures
“The external pressure placed on Barclays has reached a level that risks damaging the franchise - I cannot let that happen,” said Diamond, 60. The terms of his severance were not announced, though Sky News said the bank would ask Diamond to forfeit almost 20 million pounds in bonuses.
Politicians and newspapers have zeroed in on the scandal - which revealed macho e-mails of bankers congratulating each other with offers of champagne for helping to fiddle figures - as an example of a rampant culture of wrongdoing in an industry that stayed afloat with huge taxpayer bailouts.
Barclays released an internal 2008 memo from Diamond, then head of its investment bank, suggesting that the deputy governor of the Bank of England, Paul Tucker, had given Barclays implicit encouragement to massage the interest figures lower during the peak of the financial crisis in order to present a better picture of the bank's financial position.
According to the memo, Tucker told Diamond he had received calls from senior government officials. “It did not always need to be the case that we appeared as high as we have recently,” Diamond said he had been told.
The Bank of England declined to comment, but analyst Ian Gordon at Investec said: “Based on first inspection it does seem to suggest that Barclays have received a message from the Bank of England which provided, to put it mildly, significant encouragement.
”So they're maybe trying to share the blame but with justification. It raises a whole bunch of questions, and they're very serious and they're for the Bank of England to answer.“
However, Alistair Darling, Britain's finance minister at the time, said he found it hard to believe that the central bank would have made such a suggestion: ”What Bob Diamond or Barclays appear to be saying is that the Bank (of England) told them to do this,“ said Darling, whose Labour party is now in opposition.
”I would find it absolutely astonishing that the Bank would ever make such a suggestion and equally I can think of no circumstances that anyone, certainly in the department which I was responsible for - the Treasury - would ever suggest wrongdoing like this,“ he told Channel Four television.
Noting how the central bank provided cash to help ease the upward pressure on commercial banks' borrowing costs, he said: ”Policy was changed in order to get that rate down.
”However it would have been reprehensible and wholly unforgivable if anyone had attempted to try and manipulate this rate by simply putting in false figures”, he insisted.
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And do you have to see the govt. figures about unemployment, inflation, external debt, etc.
It's not only Barclays, led by an aging whiz kid, but others as well. Do not forget that Goldman Sachs also has much to hide with its obfuscation of Greek debts.
The derivatives markets with its arcane financial instruments also played its part in the financial mess in which the world finds itself.
That old man had the nerve to type here the there is nooo corruption in the UK, oh no, that doesn't exist there.
Of course those banksters aren't go to jail, and of course the peasants won't complain, they are to busy with the falklands issue or watching the x factor or playing video war games.
Goldmansachs, JP Morgan Chase, bank of America, Citi?
ahhh, what do you expect, they are laughing their ass off. I'm sure Jamie Diamond of Chase has a position for Mr Diamond, in the city of london..you know that small corrupted cesspool there, while peasants brag about it. They must love it to be robbed in front of their eyes.
Fido
My UK bank has never robbed me. In fact they charge very low fees. On the other hand, my Chilean bank robs me every week and the only alternative is to change to another one that will rob me just the same.
#5 sure xbox gets played, xfactor is watched, not sure about the Falklands, that obsession lies elsewhere. But that's in free time; during the rest of the week people like Peter Higgs are making interesting discoveries, the web is being invented, rolls royce engines are being shipped to all corners of the globe, 44000 patents are being filed etc, you know everyday stuff. Don't always focus on the negative, you'll give yourself an ulcer.
As for the story, well its not great, and a lot of people are pretty appalled about it; fortunately there is the political will and judicial system there to have a good go at sorting it out.
I guess UK taxpayer would not agree wit you.
@Orbit
UK unemployment statistics are base on unemployed eligible for benefits (Claimant Count) and ILO a survey made over 60k households projection.
A person who works 4 hours a week and even not receiving any payment is counted as an employed person.
Long term unemployed prospects are not counted anywhere.
Homeless hardly can qualify to get unemployment benefits because they have troubles to get a fixed address to make the claim.
Part-time employees never bother in UK to register to claim benefits.
The real unemployment in UK is close to 19% lets say around 6.3 million people out of formal work.
“As for debt, well the amount is not always the best measure ... the ability to pay back is what counts”
Ha ha debt is debt and the ability to pay is base an a ratio someone with a debt 439% the size of its GDP like in the case of UK has lost since long time ago the ability to pay otherwise is already broke.
You know Fcuk all about the UK or anything on this issue.
Just for your information:
As the identity of only a few of the (up to) 18 other global banks has been confirmed (Citigroup (AMERICAN), Deutsche Bank (GERMAN) and UBS (SWISS)), it is not yet clear how many other UK banks are in the frame.
This raises two important questions. Will Barclays come out of the LIBOR fixing scandal with some credit, and the smallest fine, for holding their hands up first? Secondly, given the media, politicians' and investors' reaction, are further senior resignations inevitable at the other UK banks, thus causing more uncertainty?
Personal debt includes amounts used for asset purchases. HOUSES mortgages.
No bank will lend any money to Argentina or it's citizen. Your country and people are either not credit worthy or skint. You are in desperate need for properties where people can live and that is why the Pikey is using robbed pension funds to provide virtually interest free loans to her followers (through fraudulent lotteries) to fund new homes. Tough for the pension members.
UK social systems support everyone in the country, whether they are working or have never worked.
Your maths on calculating the number of unemployed is shit by the way. Did you run out of fingers and toes?
Talk about the kettle calling the pan black! From such a shit hole.
The wealth in the UK is beyond your country's dreams.
The UK tax payer now owns some of the world's largest banks. That may turn out to be a good long term investment.
Also you confuse personal debt with government debt. UK gov't debt is about 80% of GDP. In Japan it is about 200%, in Italy 120% in a well run country like Chile about 5%.
The 439% figure you refers to is total private debt and comes largely from mortgages which are basically secured.
Another important fact you ignore in the debt analysis is the amount of savings. UK businesses have an estimated $1 trillion in cash that they are sitting on, waiting for the conditions to improve before investing.
I understand your point about unemployment, but a more correct term is “under-employment”. I don't work a full week, but I am certainly not unemployed and if I lived in the UK I would, rightly, not qualify for unemployment benefit.
The good thing about a recession is that you have the opportunity to put your house in order. The Brits should have fixed their roof in the summer, but you know, they like the rain and they seem to be patching the roof up fine.
You might wish to have a look at the UK economy in 1946. I think that the UK has a good record of putting its house in order.
Something ironic being criticized by an Argentina though.
Don't the Spanish have the saying 'muchas cara'?
I always find interesting how people not having idea of what they talk about resort to whatever they can to keep denying reality.
Very interesting also to see the similarity between the British and Spanish when tackling same problems the first reaction is denial. So lets provide some clarification to this...
“UK social systems support everyone in the country, whether they are working or have never worked.”
That is not true
“Your maths on calculating the number of unemployed is shit by the way. Did you run out of fingers and toes?”
Nope I didn’t, I just used common sense an economy like UK in recession (and now 2nd turn known as vv) could not have 8% unemployment having 32m workers. The economy would have unemployment ranging from 16% to 25% (last Spain case).
Buy seems I’m not alone arriving to the same conclusion. So as you are so lazy I’ve took the time to make a research for you.
“True' UK unemployment is 6.3m, says TUC”
www.guardian.co.uk/business/2012/feb/14/uk-unemployment-underemployed-tuc
@Condorito
Do you mean like the Spanish with Bankia? Ha ha ha good joke do you have more?
And can you tell me what have to do the comparison with Chile with UK and or Japan? I hope you don’t use Luxembourg next time for your comparisons.
The only one confused I guess is you mate.
What you say 80% is just public debt owed internally and denominated in British Pounds close to 2 trillion dollars at the moment.
Spain had 68%, less debt than UK and? Why Spain is having a SDC? External debt perhaps?
UK’s external debt what is the debt owed to foreigner lenders makes a total of 9.9 trillions dollars.
“The 439% figure secured.”
Nope because the banks private and now the nationalised has to rise the money to payback bonds issued to rise money internationally if they cannot (default) the uk will have to rescue them like happened before or face a entire collapse of the UK’ financial system. What happen with Bankia in Spain.
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