In brief: Barclays points finger at senior Whitehall figures, customers look at switching banks and some RBS customers find loans debited twice
FINANCIAL TIMES
Diamond lets loose over Libor
By Brooke Masters, George Parker and Kate Burgess
Bob Diamond lobbed a political grenade at the leading candidate to run the Bank of England as well as the previous Labour government just hours after his forced departure as Barclays’ chief executive on Tuesday over the Libor-rigging scandal.
The resignation of the swashbuckling American investment banker, who faces a grilling by a parliamentary committee on Wednesday, left a gaping hole in the leadership of one of Britain’s biggest global banks.
Mr Diamond quit after the governor of the Bank of England, Sir Mervyn King, and the head of the Financial Services Authority, Lord Turner, in effect called for his departure in late night phone calls on Monday to Marcus Agius, Barclays chairman...But Barclays soon dragged Paul Tucker, deputy BoE governor, and “senior Whitehall figures” from the previous government into the controversy by publishing a document suggesting they may have known of – and even condoned – the bank’s repeated “lowballing” of its submissions to the rate-setting process during the financial crisis.
THE SUN
Labour in a fix
Barclays claims pressure to rig loan rates 'came from Brown Govt'
By Tom Newton Dunn, Political Editor
Senior figures in the last Labour Government heaped pressure on banks to rig lending rates, Barclays sensationally claimed last night.
The shock allegation followed the resignation of the bank’s boss, Bob Diamond, yesterday morning.
There is speculation the senior figures worked either in the Treasury or at No10 for Gordon Brown and the hunt was on last night to unmask them.
Barclays released a typed record detailing a bombshell phone call between boss Bob Diamond and Bank of England Deputy Governor Paul Tucker in October 2008.
THE GUARDIAN
Bob Diamond cuts up rough as he quits Barclays
By Jill Treanor
Bob Diamond, the boss of Barclays who has resigned from the embattled bank, was expected to come out fighting for his reputation on Wednesday when he appears before a powerful committee of MPs. The high-profile and outspoken banker is expected to unleash a wave of explosive revelations about the role of City watchdogs and senior Whitehall figures in the manipulation of crucial interest rates that landed the bank with a record £290m fine last week. The chancellor, George Osborne, who had been putting the banker under intense pressure to quit, said his sudden resignation was "the right decision for Barclays – and for the country". "I think Bob Diamond's resignation is the first step towards the new age of responsibility we need to see." ...The American-born banker, who could be in line for a payoff of £22m, is facing pressure to walk away with nothing after being paid £100m by the bank in the past six years. There are also calls by shareholders for the bank to look at ways of clawing back bonuses paid in the past.
DAILY MAIL
Barclays 'casino' bank in chaos as house loses and head croupiers Diamond and del Missier call it quits
By James Salmon
The Barclays ‘casino’ bank was left in chaos yesterday as head croupiers Bob Diamond and his righthand man Jerry del Missier cashed in their chips and called it quits.
Top investment banker del Missier followed his boss to the exit after Barclays revealed he was responsible for instructing junior employees to rig crucial interest rates.
This culminated in a £290m fine last week from UK and US regulators.
The ‘revolving door’ at the bank was described as a ‘shambles’ amid growing fears over Barclays’ immediate future.
Critics predicted a purge of senior directors to rank alongside the clear-out at Royal Bank of Scotland and Lloyds after they were bailed out by British taxpayers in 2008.
CITYAM.COM
Diamond faces calls to return share awards
By Lauren Davidson
BOB Diamond, who lost his job yesterday, now stands to lose millions of pounds worth of unvested shares as Barclays directors prepare to repossess the former chief executive’s bonuses.
Sources close to the matter said yesterday that Diamond, who resigned as boss of Barclays yesterday after the bank was shamed for rigging interest rates, faces having his share awards rescinded if he does not relinquish them himself.
Speaking to reporters yesterday, Barclays’ new chairman Marcus Agius said the bank has “not got around” to dealing with the issue of Diamond’s pay. “We are hours into this situation. Give us a chance,” he added.
The amount Diamond stands to lose is unclear, as his future bonuses are subject to a variety of conditions, but he is set to receive millions of pounds worth of deferred shares from previous bonuses and future shares from long-term incentive schemes.
THE TIMES
Mortgages paid twice in NatWest/RBS failure
By Leah Milner
Royal Bank of Scotland is investigating reports that some mortgage and loan payments were taken out of borrowers’ accounts twice because of the computer problems that have afflicted the bank.
The state-backed bank, which also owns NatWest, would not confirm how many customers were affected, but it is thought that borrowers across both divisions have been hit.
RBS is still battling to resolve the fallout from the IT failure that occurred nearly two weeks ago, which left many customers unable to view their balances, make payments or even receive their salaries.
Stephen Hester, RBS chief executive, waived his right to a bonus in recognition of the problems its customers have faced.
MoneySavingExpert.com, the financial website, reported that a number of its readers had been complained that they were charged twice by the bank for personal loan repayments, while a small number of mortgage customers had paid been billed double for their valuation fees.
DAILY EXPRESS
Fury at banks triggers switch
By Esther Shaw
CUSTOMERS disgruntled with their bank following the NatWest computer meltdown, the Libor rate-fixing scandal and reports of mis-selling of financial products to small businesses are voting with their feet and switching.
Moneynet.co.uk, a price comparison service, reports an increase in the number of visitors to the current-account section of its website in the past fortnight as people get serious about changing banks.
“In the past, consumers have been apathetic about switching bank, with many sticking with the same provider since leaving school or starting work,” said Andrew Hagger of Moneynet. “But it comes as no surprise that those suffering major inconvenience at this time are starting to reconsider their options.
THE SCOTSMAN
‘Good news’ for families as inflation at its lowest level for three years
By Claire Smith
Inflation on goods bought in shops has fallen to its lowest level since November 2009 at just 1.1 per cent.
The drop, fuelled by significant reductions in the price of clothes and electrical goods and a slowdown the increase in the price of food, has been described as “good news” for customers.
The British Retail Consortium (BRC) shop price index showed inflation on a range of goods had fallen from 1.5 per cent in May to 1.1 per cent in June.
This is the lowest inflation rate since 2009 when it was 0.2 per cent.
BRC director general Stephen Robertson said: “Overall shop price inflation is at its lowest for two and a half years. This is good news all round for hard-pressed customers and shows retailers holding back prices as commodity cost pressures ease.”
Food inflation slowed from 4.3 per cent in May to 3.5 per cent in June, while for non-food items the fall in prices was 0.3 per cent.
Mr Robertson said falls in the price of raw materials and increased competition between retailers had translated into good news for consumers.
bbc.co.uk
Manchester United seeks $100m New York stock sale
Manchester United has applied to list on the US stock market in a share sale that aimed at raising $100m (£64m).
In documents filed with the Securities and Exchange Commission, the Premier League giant said it was listing on the New York Stock Exchange.
The club had earlier explored the possibility of a $1bn floatation on the Singapore stock market.
United, among the best-supported clubs in the world, said it would use money from the listing to repay debt.
The club has been controlled since 2005 by the Glazer family, the billionaire US sports investors who also own the Tampa Bay Buccaneers American football franchise.
But the club has in recent years been weighed down with heavy debts despite its huge global fanbase and promotional and marketing efforts.
"We intend to use all of our net proceeds from this offering to reduce our indebtedness," the prospectus filed with the SEC said.
DAILY TELEGRAPH
Britvic Fruit Shoot recall to cost up to £5m
By Harry Wallop, Retail Editor
The soft drinks company has been forced to act after a new "magic cap" designed to ensure the drink doesn't spill was found to be faulty. In some cases the cap has become detached, causing a potential hazard for customers. As a result it has issued a wide-spread product recall in both the UK and France.
The company, which is Britain's biggest soft-drinks manufacturer, would not say how many thousands of bottles have been affected, but the new cap was being used on all of its new Fruit Shoot and Hydro drinks bottles. And it has been forced to warn shareholders that it will cause a "material" dent to profits of between £1m to £5m.
“The potential financial impact of the recall is being analysed, but at this very early stage it is anticipated that there will be a limited cost estimated at between £1m and £5m to profits before tax in the current financial year,” the company said.
THE INDEPENDENT
£1.9bn fraud fine for Glaxo in US sparks calls for UK prosecution
By Lucy Tobin
GlaxoSmithKline was last night facing calls to be prosecuted in Britain after the drugmaking giant pleaded guilty to criminal charges and paid a $3bn (£1.9bn) fine to settle what US government officials called the largest case of healthcare fraud in American history.
Brentford-based Glaxo targeted patients under the age of 18 with the antidepressant Paxil when it was only approved for adults, and pushed the drug Wellbutrin for uses for which it was not approved. These included weight loss and treatment of sexual dysfunction, according to an investigation by the US Justice Department.
The pharma giant should be punished in its home country too, according to Paul Flynn, the Labour MP who was Neil Kinnock's health spokesman.
"These are huge offences. There have surely been many avoidable deaths as a result of its actions. We're too permissive of our control of pharmaceutical bodies in the UK. GlaxoSmithKline should be prosecuted here."
