Barclays’ CEO Bob Diamond resigned on Tuesday amid widespread criticism over Barclays role in rate fixing with Libor rates.
Diamond is the most high profile CEO feeling pressure after fresh inquiries surfaced last week into ethical violations within the banking industry.
Several other banks are still being investigated by regulators in the wider rate fixing probe.
“The external pressure placed on Barclays has reached a level that risks damaging the franchise – I cannot let that happen,” Diamond said in a statement.
Barclays reported on Tuesday that Chairman Marcus Agius would lead the search for Diamond’s replacement.
The scandal involves the London Interbank Offered Rate (Libor), the interest rate banks pay on money they borrow from one another.
Libor is calculated based on rate information provided by 15 of the world’s largest banks, which are under strict obligations to provide accurate figures.
Libor and the related European interbank offered rate are the benchmarks for over $500 trillion USD in global contracts, including loans and mortgages.
Last week regulators in England and the U.S. discovered that between 2005 and 2009 Barclays traders and managers repeatedly made “false reports” to manipulate Libor and other interest rate measures higher or lower than its true rate.
The manipulation increased Barclay traders’ profits and protected Barclays’ reputation in the banking industry.
But it also left consumers paying incorrect interest rates in the global market place.
Barclays’ management was fined $453 million last week by U.S. and British regulators for submitting false reports on interbank borrowing rates between 2005 and 2009.
Britian’s Chancellor of the Exchequer George Osborne said that Bob Diamond’s move to quit as chief executive officer of Barclays was “the right decision.”
On Wednesday Bob Diamond will appear before the U.K. parliamentary committee probing the scandal.
Chairman Marcus Agius will appear before the committe on Thursday.