This hunt in Whitehall might turn up no Libor witches | Daniel Finkelstein

Today, Conservative MPs will be hoping to discover the identities of the senior Whitehall figures who, according to Barclays, raised the issue of the bank’s Libor rate. Could it have been Ed Balls? Gordon Brown?

These MPs might be disappointed.

First, it is possible that Barclays weren’t told the identities. So we would have to wait for evidence from Paul Tucker, Deputy Governor at the Bank of England.

But second, there is a difference between being concerned at Barclays’ high Libor rate, and asking that Barclays manipulate that rate.

It is very important that press comment makes this distinction and doesn’t attempt to suggest that a senior Whitehall figure or Labour minister expressing concern about Barclays’s rate (which strikes me as rather impressive attention to detail) is embarrassing because it is in some way the same as urging manipulation.

Twitter: @Dannythefink

‘This disaster won’t go away until you face some hard truths.’ Read Daniel’s advice to bankers

Times Opinion today | bad bankers, science is the answer, drug cheats & Hawk-Eye

Bad bankers

“This is not a PR disaster. It’s a disaster,” says Daniel Finkelstein of the Libor-rigging scandal. He offers a little advice to the banks

Barclays could now lead the change for a better banking sector – as drugs giant GlaxoSmithKline did in pharmaceuticals, says David Wighton

The Times says the departure of Bob Diamond and Marcus Agius “must usher in a new culture of probity…intelligent risk-taking rather than excess driven by a desire for short-term profit”.

Higgs boson discovered!

But the search for the UK’s growth particle continues. Could science provide the answer? Alice Thomson thinks so

Sport

“It is not just tennis that seems intent on humiliating its officials,” Thunders Ross Clark on Hawk-Eye technology in tennis and the “military-style” reviews system in cricket

The Times says the British Olympic Association should seek longer bans for drug cheats

Russian money

Britain should ask more questions about the oligarchs flowing into London from the old Soviet Union, says Russian activist Alexey Navalny

Also

We should celebrate thus week’s election in Libya, The Times says

Diamond’s fall exposes fundamental flaws in the City | Oliver Kamm

Bob Diamond’s resignation as chief executive of Barclays signals that the failings at the bank were not merely due to rogue traders. They were institutional and fundamental – both to the bank and to the workings of the City.

There is no single interest rate in the wholesale money markets. There is proxy for a benchmark rate, which is Libor. The flaw in calculating it, however, is that it depends on the banks’ own estimates of the interest rate they would pay daily on a wholesale deposit.

This was a system ripe for abuse. Barclays manipulated the rate upwards to boost its profits, on which bankers’ bonuses were calculated.

The scandal has severely damaged the reputation of the City. It suggests the banking sector is, in effect, an oligopoly operating restrictive practices.

Twitter: @OliverKamm

“It is hard to overstate the scandalousness of the bank’s behaviour or its significance for the wider economy,” says The Times

Loading posts...