Discussion
munky said:
The second case, which is more likely that Bob knew about, did not have a profit motive. It was to prevent a run on the bank and being bailed out by the taxpayer. Furthermore, libor during that period in time was complete guesswork since interbank lending had ceased. Any guess submitted to the BBA was as right, and as wrong, as any other guess. Should he resign for saving the taxpayer billions?
No profit motive in preventing a run on the bank? Can't see that myself.If it is true that Barclays sanctioned falsification of the Libor rate, and he was involved in said falsification, then imo he will have to go. You can't ignore senior bankers submitting false data, for whatever reason.
Telegraph said:
Bob Diamond: Barclays falsified Libor to protect bank during financial crisis
Barclays chief executive Bob Diamond has admitted for the first time that the bank made a conscious decision to falsify Libor rates in order to protect the bank at the height of the financial crisis.
Barclays chief executive Bob Diamond has admitted for the first time that the bank made a conscious decision to falsify Libor rates in order to protect the bank at the height of the financial crisis.
Can't actually believe we're even discussing Diamond's status. His failure to go, and the failure of others to make him go, is astonishing. Any defence of his actions and his position is mealy-mouthed at best.
I'm old enough to remember when banking was a byword for probity. Those days seem a long way off.
I'm old enough to remember when banking was a byword for probity. Those days seem a long way off.
munky said:
speedy_thrills said:
It doesn't matter if he knew or not, it's his job to know.
1) Logistically, how is he supposed to know what 146,000 people are doing?2) How is he supposed to know what someone is doing, when they are covering it up with the aim of the boss not finding out?
crankedup said:
munky said:
speedy_thrills said:
It doesn't matter if he knew or not, it's his job to know.
1) Logistically, how is he supposed to know what 146,000 people are doing?2) How is he supposed to know what someone is doing, when they are covering it up with the aim of the boss not finding out?
Blackpuddin said:
Can't actually believe we're even discussing Diamond's status. His failure to go, and the failure of others to make him go, is astonishing. Any defence of his actions and his position is mealy-mouthed at best.
I'm old enough to remember when banking was a byword for probity. Those days seem a long way off.
Now, more than ever, the role of people in power (public or private) seems to be to take credit for what goes right, and find an excuse for what goes wrong.I'm old enough to remember when banking was a byword for probity. Those days seem a long way off.
RYH64E said:
munky said:
The second case, which is more likely that Bob knew about, did not have a profit motive. It was to prevent a run on the bank and being bailed out by the taxpayer. Furthermore, libor during that period in time was complete guesswork since interbank lending had ceased. Any guess submitted to the BBA was as right, and as wrong, as any other guess. Should he resign for saving the taxpayer billions?
No profit motive in preventing a run on the bank? Can't see that myself.If it is true that Barclays sanctioned falsification of the Libor rate, and he was involved in said falsification, then imo he will have to go. You can't ignore senior bankers submitting false data, for whatever reason.
How do you suggest the correct rate would have been submitted, when there was no rate? When any number was a guess? Hmm?
Edited by munky on Sunday 1st July 20:41
munky said:
How do you suggest the correct rate would have been submitted, when there was no rate? When any number was a guess? Hmm?
A deception is a deception, whether or not there is anything concrete to measure it against. If you don't understand that, it is because you are infected with the disease which we appear to be seeing throughout the banking sector.
Ozzie Osmond said:
munky said:
How do you suggest the correct rate would have been submitted, when there was no rate? When any number was a guess? Hmm?
A deception is a deception, whether or not there is anything concrete to measure it against. If you don't understand that, it is because you are infected with the disease which we appear to be seeing throughout the banking sector.munky said:
Survival is not the same as profit. So I guess you would have preferred they were nationalised.
How do you suggest the correct rate would have been submitted, when there was no rate? When any number was a guess? Hmm?
How do you suggest the correct rate would have been submitted, when there was no rate? When any number was a guess? Hmm?
Telegraph said:
Bob Diamond: Barclays falsified Libor to protect bank during financial crisis
Barclays chief executive Bob Diamond has admitted for the first time that the bank made a conscious decision to falsify Libor rates in order to protect the bank at the height of the financial crisis.
Barclays chief executive Bob Diamond has admitted for the first time that the bank made a conscious decision to falsify Libor rates in order to protect the bank at the height of the financial crisis.
Edited by RYH64E on Sunday 1st July 21:05
munky said:
As I said at length in the other thread, there were 2 separate "cases" of libor manipulation. One of them involved collusion between staff within Barclays, and between Barclays staff and those at 2 other banks. The aim was to create or increase profit, and therefore may be found to be fraudulent. This is the more serious case, but also the one that is very unlikely Bob knew about as the rogue staff hid their actions. Also as the FSA said it is unknown whether or not the rogue staff achieved their aim, but still they intended to. Since it is very unlikely indeed that Bob could have known about it, I don't see why he should resign.
Prior to 2009 Barclays had no policies or procedures in place to monitor how its LIBOR rates were being submitted. From the FSA report:
"Barclays had no specific systems and controls relating to its LIBOR or
EURIBOR submissions processes until December 2009"
"For example it (Barclays) did not:
i. put in place policies giving clear guidance about the importance of the
integrity of the process for determining LIBOR and EURIBOR
submissions;
ii. provide training to its Submitters about the submissions process and the
appropriateness of requests for favourable submissions;
iii. carry out formal monitoring of the submissions it made. There was no
formal monitoring of anomalous submissions until April 2010 and no spot
checks on the level of Barclays’ actual transactions in the interbank market against the submissions made until May 2010; or
iv. conduct a review of the integrity of the processes for submitting LIBOR
and EURIBOR rates until 2010 at the earliest."
From that paragraph, I feel it's unlikely that BD would have been aware of any impropriety of the traders/rate submitters (prior to the senior management intervention in the credit crisis) as Barclays were simply not monitoring it, felt it was an area of significant risk or informing/training it rate submitters.
In my experience the Compliance function would be under the remit of the COO and/or CFO, likely the Treasury Dept too, who would have been submitting the LIBOR rates. If those persons were unaware of an issue then there would be no discussion with the CEO who, again in my experience, would have the traders and front office as his remit.
Again, this is not a failure of the regulations or the FSA , nor that Barclays Group has a retail (savings) bank and an investment (BarCap), its a failure of flawed management and control by Barclays own Compliance Dept as i said on page 3.
Dont forget Northern Rock was a retail only bank, that too failed by bad management.
munky said:
Ozzie Osmond said:
munky said:
How do you suggest the correct rate would have been submitted, when there was no rate? When any number was a guess? Hmm?
A deception is a deception, whether or not there is anything concrete to measure it against. If you don't understand that, it is because you are infected with the disease which we appear to be seeing throughout the banking sector.Ozzie Osmond said:
munky said:
Ozzie Osmond said:
munky said:
How do you suggest the correct rate would have been submitted, when there was no rate? When any number was a guess? Hmm?
A deception is a deception, whether or not there is anything concrete to measure it against. If you don't understand that, it is because you are infected with the disease which we appear to be seeing throughout the banking sector.crankedup said:
If any other person(s) hold the same POV as myself its called agreement!...
Indeed. But it's amusing that you slam them when their opinions aren't the same as yours (which seems to be often), but laud them when they are. crankedup said:
Splitting the retail from investment arms of banks is great news, I have always been in favour of that....
What do you perceive the benefit to be, and precisely how do you envisage that benefit coming about? And what of the downsides?crankedup said:
Keeping the same regulations after the split, I don't think so...
Are you familiar with the detail of banking regulations? Do you think they are all unfit? Do you feel that everyone responsible for setting the regulations over the years is less technically competent at setting them than you or Vince Cable? Or could it be that the mgmt structures the regulator has in place aren't fit for purpose...;)
Murph7355 said:
Are you familiar with the detail of banking regulations? Do you think they are all unfit? Do you feel that everyone responsible for setting the regulations over the years is less technically competent at setting them than you or Vince Cable?
Or could it be that the mgmt structures the regulator has in place aren't fit for purpose...;)
If a law is broken and the criminal punished (or in this case "fined") it doesn't mean the law, or the police,are wrong. What we do need to do is punish the criminally sufficiently to deter him from doing it again.Or could it be that the mgmt structures the regulator has in place aren't fit for purpose...;)
RYH64E said:
Read it again. A conscious decision to falsify rates in order to protect the bank. That means knowingly submitting incorrect rates with the intention of manipulating the rate to favour the bank. Random guesses wouldn't protect the bank, so the submitted numbers must have been adjusted in the banks favour. Can't you see anything wrong there?
Looking at the FSA report between 1st Sept 2007 and 31st Dec 2008, upto 89% of Barclays 3month USD LIBOR submissions were in (or equal to) the highest four bank rates and were therefore not included in the LIBOR settings for that day.Edited by RYH64E on Sunday 1st July 21:05
This is also during the same period that submitters were being told to lower their rate submissions.
Personally if their senior management took a decision that might have saved them being another RBS or Northern Rock at even greater expense to taxpayers money and for the huge potential for an even bigger banking collapse, with the obvious knock on effects to the whole UK economy, I would say they made a decent decision. And you may see other banks also took similar decisions for similar reasons.
The FSA too say;
"The FSA considers there are mitigating factors in relation to Barclays’ conduct
during the financial crisis."
As John Varley (Bobs boss upto 2011) said in 2009,
"The other thing I would say is that if two of our big banks here in the United Kingdom had gone down, that would have been catastrophic....."
You have to wonder how much he knew too, but he isnt a convenient media figure.
Edited by djstevec on Monday 2nd July 00:20
even before 2008 there were days when cash desks at even the biggest banks didn't trade the majority of libor maturities, sometimes even 3 or 6 month benchmarks, the libor submissions were a best guess at the best of times. there is no right or wrong. if its way out it will be thrown out anyway, top and bottom 2. the only part of this whole story that's at all relevent is collusion between banks to go one way or the other, even then i'll bet there were other banks on the same day going the other way. the politicians must be loving this little storm to take the focus off them for a few days.
Ozzie Osmond said:
munky said:
Ozzie Osmond said:
munky said:
How do you suggest the correct rate would have been submitted, when there was no rate? When any number was a guess? Hmm?
A deception is a deception, whether or not there is anything concrete to measure it against. If you don't understand that, it is because you are infected with the disease which we appear to be seeing throughout the banking sector.
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