Barclays in 'denial', governor says

Barclays was in a “state of denial” over regulatory concerns with the bank following its rate-rigging scandal, Bank of England governor Mervyn King told MPs today.

In a Treasury Select Committee hearing,King said there were “genuine and deep” concerns

among regulators over governance and a loss of confidence in the bank’s bosses.

He said Barclays had been found to “sail close to the wind” a number of times with regulators, which indicated a worrying pattern of behaviour.

But he said the bank and its board had failed to take on board the seriousness of the regulatory concerns.

King also claimed he was not aware of deliberate rate-rigging until the full scale of the Barclays scandal came to light.

His comments come after news last week that King discussed concerns over Libor – the interbank rate at the heart of the scandal – with New York Federal Reserve president Timothy Geithner at least four years ago, raising questions over why the Bank had not acted sooner to stamp out rate-fixing.

King said he shared worries with Mr Geithner over the governance of Libor, but there was no evidence at the time of “wrong-doing”.