Bank of England exec denies pressure on Barclays

A senior Bank of England official denied Monday that he had given any hint to Barclays that it should manipulate reports of its borrowing costs.

Paul Tucker, the Bank of England's deputy governor, also told United Kingdom lawmakers on the House of Commons Treasury Committee that no one in government had leaned on him to put pressure on Barclays to "lowball" its reporting.

Barclays has been fined $453 million by U.S. and British agencies for feeding false data that went into calculations of the London Interbank Offered Rate (LIBOR), a key market index that influences the costs of a wide range of financial instruments, including some home mortgages.

Tucker's testimony was significant in shedding further light on the rate-fixing scandal that shocked the financial world, and it was Tucker's chance to give his version of a conversation with former Barclays chief executive Bob Diamond on Oct. 29, 2008.

Any hint that Tucker encouraged any false reporting -- the conclusion that some people drew from Diamond's version -- could fatally undermine the bank official's position as a leading candidate to succeed Mervyn King as governor next year.

In the wake of the fines, Diamond resigned and Barclays chairman Marcus Agius announced he would go as soon as his successor was chosen.

LIBOR is not based on actual transactions, but daily submissions are supposed to reflect each bank's judgment of the rate it would pay if it were borrowing money.