Barclays CEO Bob Diamond resigns amid rate-fixing scandal

Bob Diamond, Group Chief Executive of Barclays PLC is seen on the pitch before the FA Cup final football match between Liverpool and Chelsea at Wembley Stadium in London, England on May 5, 2012. / GettyImages

(AP) LONDON - Barclays Chief Executive Bob Diamond has resigned with immediate effect, the latest scalp of a financial markets scandal that has also cost the job of the chairman.

The bank said Tuesday that outgoing-chairman Marcus Agius would lead the search for Diamond's replacement. Agius intends to stand down once a new chairman has been chosen, a spokesperson at Barclays said.

Barclays' management has come under fire since the bank was fined $453 million last week by U.S. and British regulators for submitting false reports on interbank borrowing rates between 2005 and 2009. Much of that activity originated from traders in Barclays Capital, the division which Diamond headed at the time.

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"The external pressure placed on Barclays has reached a level that risks damaging the franchise — I cannot let that happen," Diamond said. "I am deeply disappointed that the impression created by the events announced last week about what Barclays and its people stand for could not be further from the truth."

As well as facing intense media pressure over the past few days, Diamond has seen growing calls for his resignation from the political world. Both Deputy Prime Minister Nick Clegg and opposition Labour Party leader Ed Miliband have led growing calls for Diamond, a 60-year-old American, to stand down.

Diamond said he still intended to face an influential group of lawmakers on Wednesday to give the bank's explanation for the false interest rate reports.

Barclays is one of a number of banks which regularly submit estimates of what it will cost them to borrow from other banks. These estimates feed into a calculation of the London interbank offered rate (LIBOR) which is used to determine payments from a range of financial contracts.

The London rate, and the related European interbank offered rate, are the benchmarks for over $500 trillion in global contracts, including loans and mortgages.

Barclays admitted that it had submitted lower than actual figures on its interbank borrowing during the credit crisis in 2007 and 2008. Several other global banks are being investigated in other countries for similar actions.

[jeannutson]

Such incidences shows how devastating the effects of the crisis that began in 2007 and 2008 could now have on the financial institutions that seemed resilient then and how this could trigger another major global financial crisis.

[credibility2]

If these idiots did anything illegal, they'd be charged with a crime, but what they did evidently isn't considered one. No doubt, it will now become a crime. That's how unscrupulous things once legal become illegal and therefore criminal. Interesting that Barclays put the former board chairman in charge of the search committee for a CEO replacement. Sort of like putting the fox in charge of the hen house.

[ParadoxisOK]

Question: Why aren't these guys going to prison!?

[Mikey_Mo]

Because they spun it to being just a disgraceful act, instead of something being illegal. Why do you think they used the word scandal in place of fraud.
Just like the word is is, or penalty is not a tax.

[baileycccc]

Is there any industry as corrupt as banking??????????????

[ronster6]

Used car lots.

[quotelawrence]

the premier question in my mind how much does he get to stand down 50 million, ? 100 million, ? is that standing down or us bending over, ?

[KPeters_from_UK]

There are roughly 16 more banks under investigation now in the UK.

[DCCorruption]

"The bank said Tuesday that outgoing-chairman Marcus Agius would lead the search for Diamond's replacement. Agius intends to stand down once a new chairman has been chosen, a spokesperson at Barclays said."

Let me get this straight. This Agius guy was caught in the middle of all of this, and the bank want him to find a replacement? Evidently a group of morons run this bank and should also be fired.

[Atlanticum]

Mr. Diamond has that look of a member of the privileged class...a real thoroghbred. I venture to say that he is set for life regarding his needs despite "stepping down". The old boy club will live another day.

"The CFTC also said Barclays traders in New York, London and Tokyo attempted to manipulate Libor to help their derivatives trading positions. Traders made unlawful requests to the bank's rate submitters "routinely, and sometimes daily" from at least mid-2005 to at least the fall of 2007, the CFTC said. The requests were frequently accepted by the bank's rate submitters, according to the CFTC. It quoted emails such as "always happy to help" and "Done...for you big boy.""

Quote from Wall Street Journal article ; SARA SCHAEFER MUNOZ And MAX COLCHESTER--Barclays's Agius Is Stepping Down.