Barclays to review 'flawed' practices as Agius resigns

The BBC's Robert Peston reports on the ''momentum'' that was building for Mr Agius to go

Barclays has promised a "root and branch review" and announced the resignation of its chairman Marcus Agius following the inter-bank lending rate-fixing scandal.

In a statement, Mr Agius said: "The buck stops with me."
Last week Barclays was fined £290m ($450m) for attempting to manipulate the Libor inter-bank lending rate.
Barclays' chief executive Bob Diamond will appear before MPs on the Treasury Committee on Wednesday.
Mr Agius is due to answer their questions on Thursday.
Mr Agius has also stepped down as chairman of the British Bankers' Association, which is responsible for compiling Libor.
But, Barclays said Mr Agius would remain in his post at the bank until "an orderly succession is assured".
Mr Agius, who also serves on the BBC's executive board, said last week's events were evidence of "unacceptable standards of behaviour within the bank".
He said the findings had "dealt a devastating blow" to Barclays' reputation.

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Interestingly Sir Mike Rake - the chairman of BT - has been appointed deputy chairman of Barclays, which many will see as the strongest possible signal that the board wants him to succeed Mr Agius as chairman”

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Robert Peston Business editor

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Barclays' board has launched an audit of its business practices, which will be conducted by an independent body and report to the new deputy chairman, Sir Michael Rake.

The bank promised:

• a "root and branch review" of its "flawed" past practices
• a public report of the audit's findings
• a new mandatory code of conduct for all staff

Barclays will establish a "zero tolerance policy" to anything that damages its reputation, the bank said in the statement.
Sir Michael Rake, BT chairman and senior independent director at Barclays, has been appointed deputy chairman at the bank. He is seen as a likely successor to Mr Agius.
Sir John Sunderland, a non-executive director of Barclays, will begin the search for a new chairman from Monday.
Libor scandal The leader of the opposition, Ed Miliband underlined the importance of "restoring trust" in British banks. "I really don't think that can be done by [chief executive] Bob Diamond," he said.
Mr Miliband called for a full public inquiry into the banking industry and the introduction of a new professional code for bankers.
The Labour leader also called for criminal charges to be brought against those involved in the rate-fixing scandal.
Barclays was fined after the Financial Services Authority (FSA) found its traders had lied about the interest rate other banks were charging it for loans. Investigations are also under way at RBS, HSBC, Citigroup and UBS.
Giving a lower reading than the true rate would give the impression that Barclays was considered a better lending risk than it actually was.
Reporting a higher reading than the real rate could have inflated trading profits artificially, misleading investors and regulators.
Libor (London Inter Bank Offered Rate) is the rate at which banks in London lend money to each other.
Bank of England The FSA found evidence that the bank had tried to manipulate Libor and its European equivalent Euribor between 2005 and 2009.
However, the BBC's business editor, Robert Peston said that, subsequent to 2008, Barclays managers had believed their false reporting of Libor rates had been sanctioned by the Bank of England's deputy governor Paul Tucker.
He said this misunderstanding arose following a telephone conversation in the autumn of 2008 between Mr Tucker and Mr Diamond, who at the time ran Barclays' investment bank, Barclays Capital.
The Bank says Mr Tucker did not issue this instruction. He and Mr Diamond have different recollections of their conversation, our correspondent says.
MPs are likely to question Mr Diamond about the phone call this week to try to identify what he knew about Barclays' attempts at rate-fixing, and when.
Shareholder discontent Bob Diamond said Mr Agius' decision "deserves all of our respect" and paid tribute to Mr Agius' six years as chairman: "He has been a thoughtful and supportive colleague to me in all of my roles - especially since I became chief executive last year."
But the BBC's business editor said some shareholders thought Mr Agius had failed to stand up to Mr Diamond, who was regarded as very talented but also very headstrong.
Earlier this year, Mr Agius was criticised for backing a £17.7m pay deal for Mr Diamond. A number of shareholders voted against the remuneration package.
Mr Diamond welcomed plans for an independent audit: "I am committed to ensuring that the recommendations from this review are implemented in full."
He also promised to "continue to build a culture that all of those with a stake in Barclays can be proud of".