LONDON (MNI) – Barclays’ culture was too aggressive, it was ‘gaming
the system’ and it was critical to its future that it changed, according
to top officials at regulator the Financial Services Authority.
FSA Chairman Adair Turner and Andrew Bailey, head of its
Prudential Business Unit, delivered a series of stinging criticisms
about the bank, explaining in part why former Chief Executive Officer
Bob Diamond was forced out. Turner also kept BOE Governor Mervyn King up
to date on his conversations with Barclays.
Alongside oral evidence to the Treasury Select Committee from Turner
and Bailey FSA documents were also published.
“The sort of words that we would frequently use was that there was
a culture of gaming and gaming us,” Bailey, also a BOE Director, said.
“A sequence of events over the years was giving us an impression
… about a pattern of behaviour which we felt was trying it on, gaming
the system” Turner said of Barclays.
A record of a February 2012 board meeting involving Bailey said
“There was a perception in the market and amongst some regulators that
Barclays was not all that it should be.”
It said the bank is “seen as relatively aggressive sometimes” with
staff at lower levels preferring to “engineer solutions rather than find
real answers to regulatory issues.”
The FSA said Barclays capital was “quite tight” on the basis used
by the European Banking Association and it was far from having plans in
place for resolution in the even of it running into serious
difficulties.
“The Board discussed the need to get the tone from the top right so
that all interactions with regulators are appropriates at all levels,”
it said.
Eventually, Diamond was forced out in the wake of the publication
of the heavy fine on Barclays over Libor rigging.
“I drew the conclusion that there was a problem with this
institution and the problem came from the tone from the top,” Bailey
said.
Asked if he meant Diamond, Bailey replied, “Yes”.
-London newsroom: 00 44 20 7862 7491; e-mail: drobinson@marketnews.com
[TOPICS: M$B$$$,M$$BE$]
