News - Economics / markets
Categories: Economics / Markets
The FSA's chairman Lord Adair Turner warned Barclays earlier this year its reputation in the wider market was being damaged by its own submissions to banking bodies and its handling of trading books.
In a letter sent by Turner (pictured) to Barclays' chairman Marcus Agius in April, Turner said Barclays had confused and potentially misled the European Banking Authority over its financial strength.
It was also accused of not being fully transparent with regards to how Barclays Capital operated.
Turner said: "I wished to bring to your attention our concerns about the cumulative impression created by a pattern of behaviour over the last few years, in which Barclays often seems to be seeking to gain advantage through the use of complex structures, or through arguing for regulatory approaches which are at the aggressive end of interpretation of the relevant rules."
As well as warning over its behaviour, Turner said Barclays' approach to tax management was causing damage to its reputation in the marketplace.
"The net impact has clearly been unfavourable to the degree of external trust in Barclays' approach to issues such as tax, regulation and accounting.
"The cumulative effect of the examples set out above has been to leave us with an impression that Barclays has a tendency continually to seek advantage from complex structures or favourable regulatory interpretations."
Agius responded by writing back to Turner to say the points raised had the "full attention of the board".
The letter was sent after the FSA started investigating Barclays over the LIBOR scandal which has hammered the bank's share price and cost former chief executive Bob Diamond his job. In total the bank was fined £290m by UK and US regulators.
Earlier today it emerged Diamond would forgo up to £20m of deferred bonuses he was due, although he has recieved £2m as part of a severance package.
Barclays shares are higher today despite the latest revelations. They are currently ahead 4.3p at 167.7p.
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