View the article online at http://citywire.co.uk/money/article/a604564
Del Missier: Diamond told me to order Libor fixing
(Update) Jerry del Missier, former Barclays chief operating officer, told MPs he believed he was acting on Bank of England's instructions.
Barclays' former chief operating officer, Jerry Del Missier, today told MPs that Bob Diamond instructed him to fiddle the banks' Libor rates following a conversation with the Bank of England.
Del Missier, who resigned as chief operating officer earlier this month after Barclays named him as the most senior employee to order the manipulation of Libor rates, told the Treasury Select Committee he believed he was acting on instructions from the Bank of England.
Del Missier said he'd been informed by former chief executive Diamond of a conversation with deputy Bank of England governor Paul Tucker about concerns over Barclays' high Libor rate submissions.
Libor is the average rate banks pay to borrow from one another, and is calculated using rate submissions from 16 banks – a high individual submission suggests other banks are wary about lending to it and might therefore call into question the bank's stability.
Del Missier said that as he understood it the Bank of England was under political pressure from Whitehall regarding the health of Barclays as demonstrated by its Libor rates and that they needed to get rates down. Following a telephone conversation with Diamond about this he said he then passed down an instruction to the head of the bank's money markets desk to lower rates accordingly.
Del Missier told MPs that he would not have passed down this instruction if he'd believed it had come internally and not from the Bank of England.
Diamond, however, told the Treasury Select Committee two weeks ago that he never once believed his conversation with Tucker to be an instruction.
Tucker, meanwhile, also told MPs at his meeting with the committee last week that the conversation was not intended as an instruction, and assured them that no government minister had ever leant on him to encourage Barclays or any other bank to fix their rates.
When asked why Diamond denied giving him the instruction, Del Missier said 'I can only relate what I can recall from the phone conversation that took place, I can't comment on what other people recall'.
But when asked by Conservative MP David Ruffley 'It was an instruction from Diamond wasn't it?' Del Missier replied 'Yes it was an instruction'.
Meanwhile, when repeatedly pushed by Ruffley on whether manipulating Libor rates is an illegal activity – as stated clearly by the regulator – Del Missier maintained it is not a 'yes or no' matter and said that it didn't seem 'inappropriate' given the circumstances at the time.
He later added that Libor low-balling was perhaps 'improper' in retrospect and that he 'deeply regrets what it has done to tarnish the brand'.
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