But if the director of the Serious Fraud Office was permitted to appoint a senior lawyer as special counsel, special prosecutor, who was given a team to carry out the sort of inquiry that was needed, my belief is that we would then quite quickly get to the bottom of this whole ugly affair. 19.23 Meanwhile, the House of Lords has rejected Labour plans for a judicial inquiry into banking. The bill was defeated by a margin of 251 to 197, as the Lib Dems chose to side with Tory peers. Shadow Treasury minister Lord Eatwell told peers that while an inquiry led by Mr Tyrie had "a contribution to make" its terms were "too narrowly drawn." 19.10 Marcus Agius has just spoken to Jeff Randall in a pre-recorded interview for Sky News: He said that he resigned to try and take some off the pressure off Mr Diamond but that this had the "opposite effect and if anything people were calling for Bob's head even more than beforehand." In the end "Bob concluded that it wasn't going to get better any time soon." He added: There is some point when the elastic snaps. Bob was operating under intense pressure. Mr Agius also said that his successor will need "steady nerves." 19.02 Jerry Del Missier, Barclays' former chief operating officer, has also just resigned as chairman of the Securities Industry and Financial Markets Association, which lobbies on behalf of the financial-services industry in America: 19.00 The sickness is spreading. EasyJet founder Sir Stelios Haji Ioannou has said that he plans to force a vote on the removal of Michael Rake as chairman of the low-cost airline over his role as a director at Barclays. In a statement, Sir Stelios said: Following Bob Diamond's resignation, everyone can see Mike Rake's deep conflicts of interest and entrenched positions in the disgraced "City establishment. I think "Mr. Conflict of Interest" has to let some of it go, now. We can't have a chairman who is going to be tied- up in one of the largest corporate scandals in recent history. EasyJet told Bloomberg that it was "disappointed" with Sir Stelios's move, and said it would write to shareholders urging them to reject the resolution. 18.41 ...and a rather more sinister comparison from the Guardian's Aditya Chakrabortty: 18.26 A bit of light relief from the Queen of Europe, aka "Angela Merkel" who has been kept out of the headlines by Mr Diamond today: 18.05 Marcus Agius has told Sky News that he personally knew about libor rigging for "more than two years." Mr Agius's evidence to the Treasury Select Committee has been postponed until next week (see 16.09). 18.01 Channel 4's Gary Gibbon has also posted a blog on the Diamond email which he says will trigger "a 'deep throat' style hunt for the 'senior' Whitehall sources who were pestering the Bank of England over Libor rates in 2008." He adds: The email ropes in another bank governor candidate who gets talked about - John Varley, RED's predecessor. Another possible candidate, Lord Green, now a minister, chaired the British Bankers" Association at the time. Every time the scale and reach of this scandal increases, Labour will feel that its arguments for the judicial inquiry increases. Labour is still insisting that it will not back down even if it loses Thursday's vote on how the inquiry should be constituted. John Varley was chief executive of Barclays between 2004 and 2011. 17.53 As the Barclays' board continues to shrink in size, so is the pool of candidates for the top job at the Bank of England. Angela Monaghan reports: [Today's revelations] put Mr Tucker in an awkward position, and will do him no favours as the Chancellor makes his selection for the top job at the Bank. Sir Mervyn will step down when his current term comes to an end on June 30 2013, and the formal process of appointing his successor will begin this autumn. The race for the top job at the Bank was in further disarray after Lord Turner, chairman of the Financial Services Authority and another favourite for the top job at the Bank, was dragged into the controversy. Mr del Missier, cited by Barclays as the most senior executive to give instructions to lower Libor rates and who resigned on Tuesday, was investigated by the FSA in relation to the matter, but the City regulator closed the investigation without taking any action against him. While Lord Turner is not directly named, as chairman of the FSA he must stand behind that decision. 17.38 Paul Tucker should testify in front of the TSC, according to one of the committee members. Labour MP George Mudie told Bloomberg: He is a clear candidate for the governorship of the Bank of England and he won't want this hanging over him. 17.18 More from the BBC's Robert Peston: According to reports in the Mail, Baroness Vadera, the former banker known as "Shriti the Shriek," allegedly told officials in 2008 that bringing down libor would be 'a major contribution to the stability of the banking system and to the health of the economy'. 17.06 The Bank of England has declined to comment on the Bob Diamond memo.. 17.03 Barclays has issued an amended version of its written submission to the TSC, with a few more libor charts. 16.45 David Cameron says he is happy to send Treasury Select Committee a list of meetings with banks and senior bankers. 16.32 Telegraph's Philip Aldrick: Richard Fletcher, the editor of Telegraph.co.uk: 16.29 Paul Waugh at PoliticsHome: Ed Balls has pointed out that he was Children's Secretary in 2008. 16.21 So, to sum up: A phone call between Barclays boss Bob Diamond and the Bank of England ultimately led to some of the rate-rigging actions at the heart of the ongoing banking scandal, Barclays claims. Jerry Del Missier, who was president of investment arm Barclays Capital at the time, told staff to lower the key interbank lending rate after misunderstanding Mr Diamond's account of the conversation with the BoE deputy governor Paul Tucker. 16.19 Pawelmorski, a fund manager: 16.12 Barclays says it had 13 "principal documented contacts" with FSA on Libor submissions in 2007/2008, 12 with NY Fed and two with Bank of England. Marcus Agius' appearance before the Treasury Select Committee on Thursday has been postponed until next week. 16.08 Simon Nixon from Wall Street Journal: 16.02 Barclays has spent £100m on three-year internal Libor investigation. Barclays says del Missier had been investigated over Libor submissions but regulator decided not to take action. 15.58 A letter by Barclays, that is included in that submission to the TSC, basically accuses the Bank of England of telling it to manipulate Libor so that it would appear less weak in the aftermath of the Lehman collapse. More specifically, the bank says that its CEO Bob Diamond had a conversation with BoE deputy governor Paul Tucker, wherein Tucker inquired why Barclays was submitting rates so high compared with other banks. Mr 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 [on Libor] as we have recently. 15.51 Barclays shares are now down 0.8pc following Agius' call. The bank has also released its written submission to the Treasury Select Committee. Bob Diamond will appear before the TSC tomorrow at 2pm. Agius refuses to talk about submission or role of Bank of England in Libor scandal until tomorrow's TSC meeting. 15.39 Agius: "I don't think we should limit ourselves in any direction in regards to a successor [to Diamond]. Will have a wide search for new CEO to make sure we will not overlook suitable candidates. Bank will be well managed in interim, I have been here six years, I have a good knowledge of the bank. No one else is going to quit, that I am aware of. Other banks are in a similar position to us [on Libor probe]. They will follow us. As we went first we caught a lot of attention. Any individuals with any culpability over Libor issue will be punished appropriately. BArclays was right to co-operate with authorities regardless of consequences. 15.36 Agius: "Barclays has not got around to dealing with severance pay yet... Del Missier left because of a lot of the same motivation as Diamond. On succession: "How long is a piece of string? People who have qualities to run a bank like Barclays are not that many. Vital Diamond's successor has credibility to do this difficult job. I am the obvious person to lead the search for a new chief executive. I don't anticipate leaving on the same day the new chief arrives. I will stay to welcome him in. Make sure whole bank feels secure in arrangements that have been made. I am looking to stay on [as long as it takes] and do my duty. 15.25 Agius: "Bob and Jerry put the future of Barclays ahead of their own careers." Now Agius is recapping what the pair have done for the bank. A lot of back-patting. These are important steps to move forward. Long way to go. They are just the start. I will lead Barclays for as long as it takes. We will look inside and outside the bank for replacement. Will move quickly to appoint chief executive to bring certainty. Michael Rake has committed to spending more time with Barclays. Became evident on Monday that temperature surrounding the bank was rising, Diamond felt that the situation would not go away.. 15.21 Barclays internal memo says senior figures from Whitehall raised Libor concerns with Bank of England's Paul Tucker in October 2008. Whitehall figures asked Tucker why Barclays was always at top end of Libor pricing. 15.17 Barclays "media update" delayed until 3.25pm. 15.11 Marcus Agius (below), Barclays' chairman (who is now running the bank) is speaking on a conference call in five minutes' time. We'll have the latest here. 15.01 Nell Diamond, Bob Diamond's daughter, isn't being very nice to George Osborne and Ed Miliband: For those not easily offended, I suggest you look up HMD in the urban dictionary 14.58 Sky is reporting that Barclays' board is to ask Bob Diamond to give up £18m in bonuses. The bonuses consisted of share options awarded under a management incentive scheme that had not yet vested, Sky News said, citing shareholder sources. 14.55 Binyamin Applebaum from the New York Times: 14.47 So Barclays now has no permanent chairman, no chief executive and no chief operating officer. And the Telegraph's Phil Aldrick called it right (see 14.11). Barclays chief operating officer Jerry del Missier has left the bank. He said: My 15 years at Barclays have been a time of great accomplishment, both for me personally and for the bank. I have every confidence that the Board and Executive Management of Barclays will be successful in executing their plans, and I wish them the best of luck in doing so. Barclays chairman, Marcus Agius, said: "Jerry played a pivotal role in many of Barclays standout successes during the last 15 years, including his extraordinary contributions as part of the leadership team that built the investment bank. 14.38 Barclays shares have now eased. They are up 0.8pc now after rising 4pc earlier. 14.33 Simon Denham, chief executive of London Capital Group, has said the Libor scandal is not as bad as everyone believes: Politicians, once again, show that they will do anything to jump on a vote winning band wagon and what better way than the 'ever popular' bash a banker. While no one would condone every action taken by the banks in recent years, the events leading up to 'Libor-gate' have been blown out of all possible proportion. If the Barclays fixers managed to get a 1/16 of a percent variation through, this would then have been divided by eight (as the BBA takes the average of the middle eight quotes out of 16), which would have had the massive effect of 1/128 of 1pc. Putting it another way, if you had a £400,000 mortgage, it would amount to £33.26 over an entire year! Even if all 16 banks had agreed to shift their quotes in the same direction (almost unbelievable as they would all have had contrasting/competing positions) then the total cost would have been marginal... The upshot of this is that directors may just find the UK too much of a venomous environment in which to work. The UK is at serious risk of losing the business abroad. And before anyone says 'good riddance to bad rubbish' they should first find out how the UK would replace the massive tax hole this would create. To lapse into political speak... a weakened financial services sector in the UK will mean fewer hospitals, policemen, nurses and doctors. And not a fairer society. Philip Aldrick is hearing that Barclays may be putting out a statement later about Jerry del Missier (below). It appears that he was the senior Barclays manager who misunderstood Bob Diamond's version of a conversation with Paul Tucker from the Bank of England, and as a result encouraged juniors to deliberately lower Barclays' Libor submissions. 14.05 Telegraph Economics Editor Philip Aldrick points out where Bob Diamond went wrong: Diamond never seemed to accept that the banking boom was due in a large part to a failure of regulation. Perhaps because Barclays outperformed its peers. Even after the state had pumped hundreds of billions of pounds of cheap funding into the banking system in 2008, and the Bank of England calculated that the implicit taxpayer guarantee had handed the industry a £10bn windfall, Diamond refused to accept that bonuses should be restrained. At one press conference soon after the crisis, he said he found questions about Barclays" bonuses "provocative." What he never seemed to grasp was that Barclays was the one being provocative. With the country on its knees, Barclays was driving up pay across the City with offers of guaranteed bonuses and signing-on packages that rivals were having to match simply to retain staff. He used the crisis to grow Barclays' investment bank, expanding into areas that had just plunged the country into recession with no regard for the reputational risk. Success, he believed, was the only bellwether. 13.57 Lindsay Thomas, a former director at the FSA, said suggestions that the Bank of England had condoned the rate-rigging practice would have been "a Rubicon" that would have led Sir Mervyn King to demand Bob Diamond was forced to quit. He told BBC Radio 4's World at One: They would have been livid. I would think that the Governor would have called up Barclays and made it plain that that's what they expected to happen. I think there was something behind that anyway in the remarks of the Governor in talking about the situation requiring exceptional leadership which by evidence had not been given in the past. But I think it all really came together to say that if Barclays didn't, in effect, get rid of Diamond that the working relationship between the Bank of England and the FSA and Barclays would have irretrievably broken down. A major clearing bank just can't live with that. 13.52 Stephen Hughes, director of Currencies.co.uk, believes people no longer trust banks: The Libor rigging scandal has finally taken things too far for consumers. We are witnessing record-breaking applications from clients looking at using a currency specialist because they no longer have any trust in banks. Some consider them 'a jack of all trades and master of none'. The impact this scandal will have on an international scale is also incredibly worrying. The FBI is now conducting an inquiry into bank traders accused by regulators of conspiring to rig international interest rates and could even attempt to extradite any Britons that were involved in the affair should they feel there is a case to answer. This therefore has the potential to escalate into something that could damage our relations with the US permanently and severely damage the Pound. Barclays has been hit with a record fine (£290m) and I am sure over the coming days and weeks we will learn that the scandal is likely to involve many other banks both here and across the pond. With this in mind, we suggest those looking to exchange sterling to capitalize on its recent strength and look to exchange as soon as possible. Given the current global economic activity, it may also be worth considering a forward contract to fix the exchange rate at its current level. 13.33 The FT has reported that Bob Diamond has pulled out of hosting one of Mitt Romney's fundraisers in London. 13.29 Here's the latest picture of Marcus Agius leaving his home in Chelsea today: The Barclays "chairman, not chairman, then chairman again" is leading the search for Bob Diamond's replacement.