Member Article

No pressure put on Barclays say BoE

The Bank of England did not put pressure on Barclays to lower its Libor instructions in 2008.

Speaking to MPs at the enquiry into the rate fixing scandal, the deputy governor of the Bank of England Paul Tucker said that no government ministers had asked him to “lean on” Barclays over its rates.

However, he did voice concerns from the Bank of England the Government that Barclays may need a bailout, and stresses that former Barclays boss Bob Diamond had given the “wrong impression” of a conversation between the two men.

Referring to a 2008 telephone conversation between the teo, Mr Diamond stated that Mr Tucker had said that “it did not always need to be the case that we appeared as high [with Libor submissions] as we have recently”.

Mr Tucker had made no note of the conversation, which he said should have been along the lines of: “ ‘Are you ensuring that you, the senior management of Barclays, are following the day-to-day operations of your money market desk, are you ensuring that they don’t march you over the cliff inadvertently by giving signals that you need to pay up for funds?’“

It has been revealed that at the end of October the BoE and Barclays were in almost daily email contact. It was during the same period that Barclays was trying to manipulate Libor inter-bank rates by submitting lower borrowing rates.

This was posted in Bdaily's Members' News section by Ruth Mitchell .