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London - Former Barclays chief executive Bob Diamond criticised "reprehensible" behaviour over a rate-fixing scandal in a tense appearance before British lawmakers Wednesday, the day after he quit the bank.
Diamond added that while there had been "mistakes" at the lender, swift action was taken to tackle traders' attempts to manipulate key inter-bank lending rates.
"Clearly there were mistakes, clearly there was behaviour that was reprehensible," Diamond told the British parliament's Treasury Select Committee.
He added that he had been "physically ill" when he heard of the revelations and said: "I'm sorry, I'm disappointed and I'm also angry."
But he also stressed that Barclays had acted quickly to tackle the problem.
"The attitude of Barclays three years ago when this was recognised was, let's get to the bottom of it," he said.
Diamond, 60, stepped down from the top job on Tuesday over the scandal, which may implicate other international banks and trigger criminal prosecutions.
Barclays chief operating officer Jerry del Missier also resigned Tuesday over the affair, while the bank's chairman Marcus Agius quit on Monday.
Last week, the bank was fined £290m by British and US regulators for the attempted rigging of the Libor and Euribor interest rates.
Libor (London Interbank Offer Rate) is a flagship London instrument used as an interest benchmark throughout the world, while Euribor is the eurozone equivalent.
The rates play a key role in global markets, affecting what banks, businesses and individuals pay to borrow money.
Diamond told MPs he was concerned that British officials could have seen Barclays' relatively high Libor rates as a reason to nationalise the bank at the height of the financial crisis in 2008.
Barclays had adequate funding at the time, when other banks such as the Royal Bank of Scotland were being nationalised, Diamond said.
"If Whitehall then was told Barclays was at the highest of Libor, officials might have told themselves, 'My goodness they can't fund, we need to nationalise them' as they had nationalised other British banks," Diamond said.
Lawmakers also quizzed Diamond on a telephone call he had with Paul Tucker, the deputy governor of the Bank of England (BoE), in 2008. Barclays released his summary of this Tuesday.
According to Diamond's written account, Tucker said he had received calls from "a number of senior figures within Whitehall" to ask why Barclays' Libor submissions were "towards the top end of Libor pricing."
"Tucker stated... that it did not always need to be the case that we appeared as high as we have recently," Diamond wrote in the note.
Barclays says del Missier interpreted the phone call as an instruction from the BoE to manipulate the rate, though Diamond told the committee he himself "didn't feel it was an instruction."
Former Treasury minister Shriti Vadera, a key figure close to then premier Gordon Brown, came out Wednesday to deny on BBC radio that she had spoken to Tucker about Libor.
Asked if anyone in government had suggested to the Bank of England that the rate should be manipulated, she said: "I can only speak for myself. I can't obviously speak for everybody in government.
"You asked me if Libor was a concern and of course it was a concern. There is nothing wrong with concerning yourself with access to credit. That's the job."
Tucker on Wednesday requested to appear before the Treasury Select Committee as soon as possible to give his own version of events.
"Mr Tucker is keen to give evidence to the committee in order to clarify the position with regard to the events involving the Bank of England, including the telephone conversation with Bob Diamond," the BoE said in a statement.
Prime Minister David Cameron on Wednesday branded the rate-fixing scandal "appalling" and added his voice to a growing chorus of politicians urging Barclays not to give Diamond a generous severance package.
Diamond was one of the world's highest paid bankers, earning a package worth £17.7m last year.
Barclays said Tuesday that his severance package was "still under discussion" but Sky News reported that he will be asked to give up nearly 20 million in shares promised to him in previous years but not yet awarded.
Raising suspicions of possible wider rigging, it emerged at the weekend that bailed-out Royal Bank of Scotland had sacked four traders over their alleged involvement in a similar affair.
Britain's Serious Fraud Office on Monday announced that it was considering whether to bring criminal prosecutions over the issue, while Cameron has announced a parliamentary inquiry into the scandal.
Lawmakers will vote Thursday on whether to back calls from the main opposition Labour party to set up a judge-led inquiry similar to the press ethics probe triggered by phone-hacking at Rupert Murdoch's media empire.
