It’s LIBOR time again at Barclays. The scandal which deposed the beloved Bob Diamond, along with Rich Ricci and Jerry Del Missier, and then resulted in the installment of Antony Jenkins as chief executive, won’t go away. New court papers, reported in the Telegraph, suggest that a Barclays fund based in Singapore tried manipulating ‘UK borrowing rates for its own profit’. Barclays has already settled the LIBOR case, but now it’s reopened like a septic knee.
The reappearance of the ‘LIBOR scandal’ is likely to cause a few problems at Barclays, where we understand it’s a touchy subject. So far the bank has paid £290m to settle its LIBOR claims. However, Barclays has set aside more than £2.5bn to cover claims related to the mis-selling of payment protection insurance (PPI).
Bob Diamond, the former chief executive of the investment bank and of the Barclays Group as a whole, resigned as a result of LIBOR. Yet Antony Jenkins, who was head of the retail bank from 2009 when the PPI ‘scandal’ was still being perpetrated, was elevated to the position of Barclays Group chief executive following the PPI scandal.
Worse, Jenkins is on a crusade to improve the culture of the Barclays, with the LIBOR-related misdemeanours of the investment bank at the front of his charge.
Senior Barclays insiders complain that it smacks of hypocrisy. “It feels like we’re carrying the can. There’s no real recognition internally of what went wrong with PPI – the whole emphasis is on LIBOR,” says one. “And guess who was in charge of the bank when the PPI mis-selling was going on – Antony Jenkins. There was clearly a lot going wrong there at the time too.”
Barclays’ investment bankers are worried about the ultimate size of the PPI losses, says the banker. “Everyone is talking about the investment bank and LIBOR, but you have this far more significant thing in the background, which no one mentions because Jenkins was involved.”
Barclays declined to comment.