Barclays can live with the fine, but damage to the bank's reputation and that of its top management, none of whom has resigned, could be lasting.
Barclays says many of those directly responsible now have left the bank. Some employees may yet face disciplinary and even criminal proceedings, according to people briefed on the situation.
The bank says top managers were unaware of the abuses, cooperated fully with the investigation, settled quickly and have introduced new processes to prevent this from happening again.....
But this isn't good enough. The regulatory documents show that, at best, Mr. Diamond and his team presided over a culture of sloppiness, greed and a lack of concern for clients' interests. At worst, employees' behavior flirted with criminality.
For all Mr. Diamond's recent homilies about "citizenship," investors will wonder whether an unchanged top team is really best-placed to restore the confidence of clients and regulators....
Certainly, [the Libor scandal] threatens to further undermine public confidence in the investment-banking industry at a time when its business model and ingrained conflicts of interest are under unprecedented scrutiny.
The scandal also threatens to do further damage to the reputation of London as a financial center. The Barclays settlement comes just days after a U.S. senator publicly noted how many boom-time scandals originated in London.
All the more reason why Barclays should show real citizenship by taking the sort of action that might signal the world it truly understands the gravity of this scandal.
Restoring credibility and trust can only be achieved by voluntarily providing ultra transparency and disclosing on an on-going basis its current asset, liability and off-balance sheet exposure details.