As sunlight radiates from US investigations into the Liebor saga, the British Bankers' Association looms more clearly out of the gloom. Emails in 2008 between from Tim Geithner, then President of the NY Federal Reserve, and Mervyn King resulted in the Bank of England passing on to the BBA suggested reforms to the way Liebor was
fiddled determined. But after a 'consultation process' only two of six reforms were adopted.
It seems odd that the Bank of England seemed a mere conduit for US reform suggestions, rather than insistent that they be taken up. We know that neither Liebor nor the BBA's Liebor arm were regulated, but clearly the NY Fed expected the Bank of England to be able to do something. Had relations soured to the point that no amount of 'eyebrow-raising' was effective?
It's interesting that Angela Knight was called upon to resign as CEO of the BBA in May 2011, when the banks were finally shamed into compensating customers for PPI mis-selling. Even they spoke of wanting someone less 'stringent' and 'combative'. Similarly, Barclays' ex-Chairman-now-reappointed Marcus Agius recently confessed that he received a stern letter from the FSA Chairman, Lord Turner, complaining that Bobby "Dazzler" Diamond had become "unhelpful" and "aggressive".
That's the same Marcus Agius who chairs the British Bankers' Association, in case you were wondering...