Bank of England Deputy Governor Paul Tucker was to get the chance overnight to testify on the Libor scandal that cost Barclays' top three managers their jobs and cast doubt on his prospects of succeeding his boss, Mervyn King.

Tucker, 54, was to take the seat occupied by former Barclays chief executive Robert Diamond on July 4 and tell lawmakers his side of a 2008 phone call between the pair that has drawn the Bank of England into the furore on interest-rate manipulation.

A memo Diamond wrote suggested Tucker might have hinted Barclays could lowball its Libor submissions.

That revelation jeopardised Tucker's position as the front-runner to replace King, earned as the deputy governor entered his fourth decade working at the central bank.


Tucker requested the hearing 90 minutes before Diamond's appearance at Parliament in an escalation of the tumult following Barclays's admission of false rate reporting.

"It's the battle of the titans where the powerful banker is pointing the finger at the guy who's heading to be the next governor," said Marcus Miller, a professor at the University of Warwick who was doing research at the central bank at the time of the October 2008 phone call.

"Tucker may get asked about whether he counselled lowballing, and whether Diamond's version of events is believable.

"I think he can save himself."

Parliament's Treasury Committee was to question Tucker in London.

The central bank said last week that he wanted to testify as soon as possible to "clarify the position with regard to the events involving the Bank of England, including the telephone conversation with Bob Diamond on October 29, 2008".

Diamond, Barclays' investment-banking chief at the time, relayed his version of that call in an email to John Varley, his predecessor as chief executive.

Regulators obtained the note as they probed Barclays's Libor reports, which led to the second biggest British bank being fined a record £290 million ($564 million).


Diamond, chairman Marcus Agius and chief operating officer Jerry Del Missier have since resigned.

"Further to our last call, Mr Tucker reiterated that he had received calls from a number of senior figures within Whitehall to question why Barclays was always toward the top end of the Libor pricing," Diamond wrote in the note.

"Tucker stated that the levels of calls he was receiving from Whitehall were 'senior' and that while he was certain we did not need advice, that it did not always need to be the case that we appeared as high as we have recently."

Diamond told lawmakers last week that his assessment of the call was "appreciation of Paul Tucker in doing his job".

"What he was trying to tell me is: 'Bob, there are ministers in Whitehall who are hearing that Barclays are always high'," Diamond said. "'That could lead to the impression that you're not funding yourself."'

He also said he didn't interpret the conversation as a request to change Barclays' Libor submissions.

Diamond said he asked Tucker to tell government officials that not all banks were providing Libor quotes that represented the true level at which they could borrow money.

He said he was also concerned Barclays could have been nationalised if it showed signs of difficulties in obtaining funding.

- Bloomberg