So Labour ministers did not ‘lean on’ the Bank of England to encourage lowballing of Libor rates, according to Paul Tucker. The Deputy Governor of the Bank told the Treasury Select Committee this afternoon that he had held conversations with officials about how able Barclays was to fund its operations.
This is the exchange between Pat McFadden and Mr Tucker. McFadden asked whether any minister had tried to ‘lean on’ him over Libor:‘Absolutely not.’
Asked whether Shriti Vadera had leant on him:
‘I don’t think that I spoke to Shriti Vadera throughout this whole process.’
Ed Balls?
‘No’
Other ministers?
‘No’
He confirmed that the ‘senior official’ that he had spoken to was Jeremy Heywood, and added that he also held regular conversations with Tom Scholar at the Treasury, Jon Cunliffe at the Cabinet Office and Nick MacPherson at the Treasury, and said his conversation with Bob Diamond (you can read Diamond’s recollections here) in 2008 actually ran along these lines:
‘The next bit is, and I also said, and this is also recollection, clear recollection that there was nervousness in the bank and I think amongst officials about how firmly based is that decision, have we done the right thing, those circumstances, my phoning up and saying everybody is talking about you.
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