Barclays chairman resigns over rate-fixing scandal

Barclays chairman Marcus Agius on Monday resigned over the inter-bank lending rate-fixing scandal.

Barclays chairman Marcus Agius on Monday resigned over the inter-bank lending rate-fixing scandal.

In an announcement issued by Barclays on its website, the bank said Agius, who chaired the bank for six years, would remain in his post until a successor was found.

 “I am truly sorry that our customers, clients, employees and shareholders have been let down,” Agius said in a company statement, less than a week after the bank was fined over rigging key interest rates.

Barclays added it would launch an independent audit that would “undertake a root and branch review of all of the past practices that have been revealed as flawed since the credit crisis started.

“The bank insisted it would establish “a zero tolerance policy for any actions that harm the reputation of the bank.”

Last week, Barcalys was fined 450 million U.S. dollars for attempting to manipulate interbank lending rates, known as the London Interbank Offer Rate (Libor).

Agius said the events have “dealt a devastating blow to Barclays’ reputation. As chairman, I am the ultimate guardian of the bank’s reputation.

“Barclay’s chief executive Bob Diamond will appear before MPs on the Treasury Committee on Wednesday. Agius is due to answer their questions on Thursday.

Barclays’ board has launched an audit of its business practices, which will be conducted by an independent body and report to the new deputy chairman, Sir Michael Rake. The bank promised to publish a public report of the audit’s findings and produce a new mandatory code of conduct for all staff.

More banks, including Britain’s HSBC and Royal Bank of Scotland (RBS), Citigroup in the United States and Switzerland’s UBS, are under investigation for allegedly providing false figures on key interest rates upon which mortgages and consumer loans are priced. The scandal has aroused strong criticism from politicians and investors.

British Justice Secretary Ken Clarke on Saturday called for criminal prosecutions of bankers and stronger financial regulation after the scandals. Business Secretary Vince Cable said the government was “trying to clean up a massive cesspit in the banking system.”

Ed Miliband, leader of the opposition Labor party, was quoted by The Times as saying that a “corrupt elite” in Britain’s banks must be brought to book with tougher rules and jail terms as part of a national reckoning with the City.

 He accused the banking system of being “institutionally corrupt” as he announced proposals for a 12-month public inquiry into the issue.

 Sir Mervyn King, governor of the Bank of England, the central bank, also criticized the wrongdoing, saying that bank bonuses had been “excessive,” the treatment of customers “shoddy” and the manipulation of rates “deceitful.” The government is also considering a review into bankers’ professional standards.

 

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