UPDATE 2-Barclays president says media told of deal gain

* Diamond: Media told that bank aimed for accretive deal

* Diamond: Unsure if comments were official court disclosure

* Case shows frantic last days, need for "living wills"

* Lehman CEO says did not expect a gain for Barclays'

* Barclays CEO Varley due to appear Tues

By Chelsea Emery (Recasts lead to focus on Diamond testimony, adds byline)

NEW YORK, June 21 (Reuters) - Barclays Plc's (BARC.L) President Robert Diamond said on Monday that the British bank's comments to the media about its deal to acquire parts of Lehman Brothers may not have been official disclosure to the U.S. bankruptcy court, which approved the takeover.

At issue is whether the British bank received an unfair $11 billion windfall when it acquired parts of Lehman Brothers after the investment bank's collapse in Sept., 2008. [ID:nN16151713]

Diamond said that Barclays had tried to craft a deal to take over Lehman's core U.S. brokerage business in a way that Barclays would see a gain. He also said the bank had made that goal public to reporters and financial analysts.

Capital appreciation "was something that was important to Barclays and something we talked about with the media and analysts," said Diamond in testimony in New York."

But when Lehman attorney, Robert Gaffey asked if Diamond agreed with him that discussions with media and financial analysts were not a form of disclosure to the court, Diamond responded: "It may or may not be. I don't know."

Diamond also testified that he could not have guaranteed that the transaction would offer a gain.

"There simply was no way to guarantee capital appreciation," Diamond testified in New York bankruptcy court.

Lehman creditors want the judge, who approved the transaction 21 months ago, to review the sale. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

For a graphic Barclays timeline since June 2008, click on:

here

For a Breakingviews column see [ID:nLDE65K0HI]

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Earlier on Monday, Lehman Brothers Holdings Chief Executive Bryan Marsal said he had believed that the purchase of Lehman would be a "wash" but that Barclays' financial statements later raised concerns.

The bank's quarterly earnings, released after absorbing Lehman, "indicated there'd been a substantial built-in gain from the transaction itself, which would suggest that net assets received were greater than liabilities assumed," said Marsal in testimony.

Marsal is overseeing the liquidation of the remaining U.S. assets.

U.S.-based legal experts have said Lehman faces an uphill battle in proving that Barclays arranged a secret discount and persuading the judge to change the original sale order.

Barclays has said Lehman's assets were inflated when the deal was struck, and it marked them to their true value. It has accused Lehman's lawyers of trying to change the deal after markets improved.

The deal has worked out well for BarCap, delivering bumper profits as capital markets have improved and allowing it to grab market share and add equities and advisory at a time when Wall Street rivals were retreating.

Lehman's bankruptcy in September 2008 was the largest in history, and less than a week later Barclays swooped in on Lehman's flagship U.S. brokerage business for about $1.85 billion.

The case has shown how frantic conditions were during Lehman's final days and is evidence of the need for banks to set up so-called living wills to detail how they should be broken up in the event of collapse, according to regulators and bankers.

Setting up resolution regimes should be one of the main lessons of the financial crisis, the Institute of International Finance said last month, so a bank can collapse in an orderly way without threatening counterparties and spreading risk through the financial system. [ID:nLDE64N16S]

Barclays Executive John Varley is scheduled to testify on Tuesday.

Varley has run Barclays since 2004 and steered his bank through the crisis without any need for state aid. The keen angler and table tennis player, known for his precise language and close attention to detail, was less involved in the transaction and had not been expected to be called.

The case is In re: Lehman Brothers Holdings Inc, U.S. Bankruptcy Court, Southern District of New York, No. 08-13555. (Reporting by Steve Slater and Chelsea Emery; Editing by Michael Shields, Matthew Lewis and Bernard Orr)