Skip to main content

Barclays makes public apology after rate-rigging scandal

By the CNN Wire Staff
July 14, 2012 -- Updated 1524 GMT (2324 HKT)
Barclays bank has paid for newspaper ads to say sorry in the wake of the rate-rigging scandal.
Barclays bank has paid for newspaper ads to say sorry in the wake of the rate-rigging scandal.
STORY HIGHLIGHTS
  • Barclays says it is "truly sorry for what has happened and that you have been let down"
  • It pledges to work for its clients and customers and earn right to keep their business
  • The bank has been rocked by a rate-rigging scandal that has forced out top executives
  • Barclays was fined $450 million last month by British and U.S. regulators

London (CNN) -- Barclays bank took out large UK newspaper ads Saturday to say sorry to "all Barclays customers and clients" in the wake of a rate-rigging scandal which has hammered its reputation.

The public apology, printed in papers including the Financial Times and the Times of London and signed by outgoing chairman Marcus Agius, says the bank is "truly sorry for what has happened and that you have been let down."

It continues: "It is our actions now over the coming months and years that will make the difference.

"You are the lifeblood of our business, and we will not allow ourselves to be distracted from what really matters -- delivering for you, day in and day out."

Barclays is determined to put its customers "at the heart of everything we do" and must earn the right to retain their business, the statement concludes.

Agius's resignation as chairman was announced 12 days ago, as the scandal over the rates at which banks lend each other money gathered pace. He will step down once a replacement is found. Following wide pressure, the bank's former chief executive, Bob Diamond, resigned a day later.

The scandal involves a lending rate, known as the London interbank offered rate, or Libor, which is set every morning by banks posting the rate at which they are willing to borrow with the British Bankers' Association. The BBA publishes Libor as a result of this.

The Libor affects how much interest ordinary people pay on everything from credit card debt to home mortgages and student loans.

Barclays was fined $450 million by British and American regulators last month after admitted some of its trading desks purposely under-reported its interest rates.

A report from the UK's Financial Services Authority concluded the rate-fixing scandal was of the "utmost seriousness."

Between 2005 and 2009, when Diamond was in charge of the investment branch of Barclays bank, traders were influencing the pricing of rates which impact up to $800 trillion of securities.

E-mails revealed as part of the rate-fixing investigation showed traders were seeking beneficial rates for their trading positions. Diamond has blamed the wrongdoing on 14 traders out of "a couple thousand."

During the credit crisis of 2007 and 2008, Barclays' high Libor postings came under scrutiny and the bank, concerned about "unfounded negative perceptions," lowered its Libor submissions, according to Barclays notes to the Treasury Committee.

A host of other banks, including Deutsche Bank, Royal Bank of Scotland, Credit Suisse, Citigroup, JPMorgan Chase and UBS, are being investigated by regulators. Lawsuits have been filed against the banks in the United States, and are being prepared in the UK.

CNN's Isa Soares and Alex Felton contributed to this report.

ADVERTISEMENT
Part of complete coverage on
Banking crisis
August 19, 2012 -- Updated 0252 GMT (1052 HKT)
A British parliamentary report slammed Barclays bank on Saturday for its "disgraceful" actions that led to a rate-rigging scandal.
August 16, 2012 -- Updated 1202 GMT (2002 HKT)
Standard Chartered is far from the only bank to be implicated in illegal transactions with sanctioned nations.
July 12, 2012 -- Updated 1350 GMT (2150 HKT)
Barclays has been in the spotlight recently, but the rate-fixing scandal which lost its boss his job looks set to reach far further afield.
July 4, 2012 -- Updated 2118 GMT (0518 HKT)
CNN's Richard Quest talks to Lord Levene about the Barclays scandal. Levene says London's culture of money must change.
Read texts and emails between Barclays traders about their often successful attempts to manipulate global benchmarks for interest rates.
July 3, 2012 -- Updated 2107 GMT (0507 HKT)
There are many pieces to the global banking scandal. CNN's Richard Quest explains how they all fit together.
July 5, 2012 -- Updated 1731 GMT (0131 HKT)
Richard Quest says the Libor scandal has confirmed what many of us already knew: There is something smelly in the London financial world.
July 3, 2012 -- Updated 1147 GMT (1947 HKT)
Stephen Hester writes an open letter about the banking crisis, and why, although we may be angry with the sector, we can't give up on banks.
July 2, 2012 -- Updated 2305 GMT (0705 HKT)
CNN's Richard Quest breaks down the LIBOR and explains how this benchmark rate affects the banking system.
ADVERTISEMENT