From the pen of Barclays chief executive, Bob Diamond, to the bank’s employees. (H/T BBC)
Let me start by saying that I understand why the reaction has been severe. No one is more sorry, disappointed and angry about these events than I am.
I am sorry because we let down the people whose trust we rely on – our customers and clients; our shareholders; our regulators; and the communities in which we live and work.
I am disappointed because many of these behaviours happened on my watch. It is my responsibility to make sure that it cannot happen again.
More than anything, though, I am angry because the impression has been given that the behaviour revealed in the documents last week is indicative of the culture at Barclays generally.
I love Barclays, and I am proud of all of you. We all know that these events are not representative of our culture, and it is my responsibility to get to the bottom of that and resolve it. Make no mistake the actions taken in this incident were against all of the principles we live by.
It is important to bear in mind that this behaviour stopped nearly three years ago. The documents released last week represent part of an industry-wide investigation and are the result of investigations which we carried out in cooperation with three different regulatory Authorities over three years.
Those investigations studied millions of pieces of evidence, many hours of interviews and careful review of all aspects of the behaviour under question. All of that is the result of our very close cooperation with the Authorities, which they emphasise.
We did not wait for those investigations to be completed, however. We moved to fix issues when they were uncovered – the systems, controls and training that we now have in place around the submission of LIBOR and EURIBOR are first-class.
We have agreed with the Authorities to have our controls related to the submission processes externally audited on a regular basis. We will also publish the results of that external audit.
Our customers and clients are particularly concerned about the potential impact of this behaviour on them. Let me be clear: it does not matter if this was perpetrated by one individual or a handful – it was wrong.
But we must help our customers and clients recognise that on the majority of days, no requests were made at all. Even when made, the requests were not always accepted by the submitter, and the attempted adjustments were, on average, small – typically less than one basis point. When the ultimate rate was affected is a complex question, especially given the role of the other banks’ submissions. This helps explain why the Department of Justice concluded that the rate was affected only on “some occasions”. All of that said, I appreciate that some clients will be concerned that there may be an impact on them. We are setting up a dedicated process to ensure that any client concerns can be dealt with consistently.
The events revealed last week arose in large part because we did not have appropriate controls in place. Frankly, we misjudged the risk associated with the underlying activity. That must never happen again. Once we better understood the risks, we put in place the right controls and systems.
“We will establish a zero tolerance policy for any actions that harm the reputation of the bank,” Mr Diamond said.
UK plans banking standards inquiry – FT