Key questions for MPs grilling Barclays and FSA

Treasury select committee MPs will also question the Financial Services Authority, the banking watchdog, later today to ask why it failed to act immediately after US regulators warned the UK of rate fixing in 2008.

Mr del Missier will be the first to appear before the committee at 4pm. He faces intense questioning after revelations that the Federal Reserve Bank of New York knew Barclays was submitting false Libor rates in 2007 and warned UK authorities in 2008. The Libor rate is used to set everything from student loans to mortgages.

Mr del Missier’s appearance comes after MPs questioned Bob Diamond, Barclays’ ex-chief executive, who said Mr del Missier misinterpreted his written comments after Mr Diamond’s phone conversation with Bank of England Deputy Governor Paul Tucker. Mr Diamond told MPs that Mr del Missier wrongly interpreted his note to mean the BoE was pressuring Barclays’ to lower its Libor submissions.

His appearance will be followed by Adair Turner, head of the Financial Services Authority, which began investigating in 2009, two years after the new York Federal Reserve said it was receiving anecdotal evidence from Barclays about rate rigging and a year after the Fed told the Bank of England. MPs will want to know whether Bank of England officials or the FSA were intentionally slow to act, and the FSA’s opinion of Mr Diamond.

• Key questions for Mr del Missier:

• When did you first become aware that Barclays’ staff were fixing interest rates?

• What discussions did you and Mr Diamond have about setting the Libor rate before and after Mr Diamond’s October 2008 phone call with Bank of England Deputy Governor Paul Tucker?

• What discussions did you have about Libor rate-rigging with Mr Diamond or any other senior management in the period between 2007 and 2012? If there were no discussions, why not? This was a criminal activity. Who did you speak to?

• Exactly what instructions did you pass down to bankers regarding Libor rates after Mr Diamond and Mr Tucker’s 2008 phone call?

• Did you have any direct contact with the Bank of England or any senior Whitehall officials about the Libor rate? If so, who and what were the discussions.

• We have heard Barclays’ staff openly shouted across the trading floor about plans to fix the Libor rate, and that there were 177 e-mail exchanges concerning Libor rate fixing. Did you inform Mr Diamond and other senior staff that rate rigging was common practice at Barclays? If not, why not?

• Did the false Libor rates help Barclays avoid nationalisation of the bank? Did it increase your bonus and salary, reportedly £40m a year in 2010?

You are the third Barclays executive to resign as a result of the scandal. Were you pressured to resign from individuals inside the bank, and if so by who? Was there any pressure from individuals outside the bank and, if so, who?

• Were you directly instructed by the Bank of England or any senior Whitehall official to lower Barclays’ Libor rate? If yes, by who?

Mr Tucker said that “senior Whitehall figures” were pressuring him on Libor. Who do you believe these figures are?

Mr del Missier has been given 45 minutes to testify. He will be followed by Lord Turner, then Andrew Balley, head of the FSA’s prudential business unit, and Tracey McDermott, the FSA’s acting director of enforcement and financial crime.

The three regulators are expected to be questioned about when they were informed banks were rigging the Libor rates, what actions they took to stop the practice, why it so long for the regulator to act, and whether they too were pressured by senior Whitehall officials, Bank of England officials or others on how to handle the rate rigging. MPs will also likely ask about Mr Diamond’s fitness to run Barclays amid FSA concerns and “issues” with his leadership as far back as October 2010.

Bank of England Governor Mervyn King faces the committee on Tuesday.