British bank Barclays announced Tuesday, July 3 the resignation of its chief executive, Bob Diamond, and its director of operations, following the scandal over the manipulation of Libor and Euribor interbank rates by the institution.
“I am very disappointed because the events of last week provide a picture of Barclays and its employees could not be farther from reality,” said Mr. Diamond said in a statement.
In the afternoon, the bank has added to these defections the resignation with immediate effect of his operations director, Jerry del Missier. The latter was co-chairman of the investment banking arm Barclays Capital, BarCap in the jargon, between 2005 and 2008, when some of the events occurred.
The scandal has already Libor led to the resignation of Marcus Agius, chairman of Barclays, and caused an outcry against the practices of the banking sector, and parliamentarians of all persuasions have claimed to see things more clearly.
FIND A NEW EXECUTIVE DIRECTOR
Marcus Agius and chief executive of Barclays, Bob Diamond, were under pressure because the bank will have to pay $ 453 million (358.5 million euros) to stop the prosecution against the bank in Britain and the United States. Mr Agius’s mission is to find a new CEO and to replace him, Barclays said in a statement Tuesday.
Barclays admitted that some of its traders had tried to manipulate the Libor, which is a benchmark for financial contracts and loans involving more than 350 000 billion.
The investigation into the Libor spreads across Europe, Japan and North America. Citigroup, HSBC and UBS are also discussed. Moreover, the four major UK banks have agreed to pay restitution to their customers, namely SMEs, to be uninformed on interest rate hedging products.
The British bank loses its luster
Founded in 1690 in Lombard Street in the City, the establishment has been listed since 1902 in the London Stock Exchange. It employs around 140,000 people and operates from Africa to America, Asia and Europe, especially France, where it has 170,000 customers, more affluent in general.
This is the fourth largest bank in the world in terms of assets and the second in the UK after HSBC, ranked by 2011 from Global Finance magazine.
His name is familiar in Britain, where his blue eagle adorns number of bank branches across the country but also the service of self-service bicycles in London. It also sponsors the popular English league football.
Barclays had missed a major expansion in 2007 by failing to buy the Dutch ABN Amro following year but had acquired the North American operations of Lehman Brothers for almost a pittance.
The group achieved last year an annual net profit of 3 billion pounds, about 3.5 billion euros, down due to the poor performance of BarCap. The latter division, long considered the crown jewel for its profitability, has indeed suffered from the recent turbulence in financial markets.
Barclays has also lost its luster when they met recently at the forefront during the controversy over the bonuses in the financial sector in Britain. At the general meeting in April, nearly a third of shareholders refused to approve the remuneration report, due in astronomical sums paid to Mr. Diamond, despite mixed financial performance.