Tue July 10, 2012
Ex-Barclays CEO Gives Up $30 Million In Bonuses; Was Pressured To Quit
Robert Diamond, the newly departed chief of Barclays bank, won't collect millions in stock bonuses on his way out the door.
He'll still get his annual salary and a one-time payout, worth about $3 million, according to Reuters.
Barclays is embroiled in a scandal over LIBOR interest rates. As Planet Money's Robert Smith explains, Barclays' traders tampered with the rates for bank purposes, affecting trillions of dollars in worldwide contracts:
LIBOR, as it turns out, is the rate at which banks lend to each other. And more importantly, it has become the global benchmark for lending. Banks look at it every day to figure out what they should charge you for not just home loans, but car loans, commercial loans, credit cards. LIBOR ends up almost everywhere.
Diamond ran Barclays until last week when the scandal broke open and he resigned.
He was apparently pushed by the Bank of England, according to Marcus Agius, the off-again, on-again Barclays chairman. The Guardian reports Agius gave "gripping testimony" to British lawmakers today who are investigating the LIBOR scandal. He said the Bank of England governor warned Barclays that Diamond no longer had regulators' support.
Agius also told the lawmakers of Diamond's decision to forgo his bonuses. Agius also quit over the scandal, but was returned to his job by the board of directors to help seek Diamond's replacement, notes Reuters.