So What Did Bank of England Know?

Daily Mail (London), July 2, 2012 | Go to article overview

So What Did Bank of England Know?


Byline: James Chapman Political Editor

PRESSURE was last night intensifying on the Bank of England over precisely how much it knew of Barclays' fixing of interest rates.

A phone conversation between deputy Bank of England governor Paul Tucker and a 'senior' manager at Barclays is said to have led to traders 'mistakenly' believing they were working under an instruction from the central bank to fix the Libor - the interest rate at which banks lend money to each other.

And last night it was suggested that Barclays chief executive Bob Diamond could give 'explosive' testimony about his discussions with the Bank when he appears before a committee of MPs later this week.

But the Bank of England categorically denied it had known anything about attempts to fiddle the rate.

The Daily Mail revealed on Saturday that rumours were swirling in Whitehall about what discussions the Bank and the Treasury had with banks about Libor.

The rate acts as a crucial indicator of the health of the banking sector, and therefore the wider economy. In 2007, experts began to express concern that the rate was rising, suggesting banks were becoming wary of lending to each other.

According to two separate official reports prepared on both sides of the Atlantic, a senior Barclays official and a senior figure at the Bank talked on October 29, 2008.

The Bank official is alleged to have asked why Barclays' Libor submissions were higher than those of other banks.

The Financial Services Authority's report on Barclays published on Wednesday said Mr Tucker spoke with a senior Barclays manager on October 29 in a routine telephone call.

In it, he made 'no instruction for Barclays to lower its Libor submissions'.

But the report added: 'However, as the substance of the telephone conversation was relayed down the chain of command at Barclays, a misunderstanding or miscommunication occurred. 'This meant that Barclays' submitters believed mistakenly that they were operating under an instruction from the Bank of England (as conveyed by senior management) to reduce Barclays' Libor submissions.' Submitters are the managers who give borrowing data to the British Bankers Association's Libor-setting committees. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

So What Did Bank of England Know?
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.