video transcript

Governor of the Bank of England Mervyn King is used to explaining the central bank's monetary policy to journalists. On Tuesday he faced questions from a committee of British MPs over his role in the resignation of Barclays chief executive Bob Diamond and the Libor interest rate rigging scandal. SOUNDBITE: Mervyn King, Governor of the Bank of England, saying (English): "What had happened over many months was that the board of Barclays had been in something of a state of denial about the concerns of the regulators." King said he had to tell the bank that regulators had also lost confidence in Bob Diamond as chief executive. But he fended off repeated questions from lawmakers about who had told Barclays bosses that Diamond would have to go. King said Barclays now has to move on from the scandal and will do so with the help of Chairman Marcus Agius, who also resigned amid the Libor scandal. SOUNDBITE: Mervyn King, Governor of the Bank of England, saying (English): "Now Barclays, which is a great bank, has to look forward and create a new bank with a new culture, take it forward. And I felt that, I mean I think that Mr. Agius has made clear that he will perform the task of ensuring that we get through this difficult period but will then leave." Barclays was fined a record $453 million by U.S. and UK authorities for manipulating the interbank lending rent, or Libor, an interest rate which underpins transactions worth trillions of dollars worldwide. King says when he meets other central bankers in September he will put discussion of Libor on the agenda. SOUNDBITE: Mervyn King, Governor of the Bank of England, saying (English): "The future arrangements for this sort of benchmark interest rate. Because the big lesson from this period was that there was nothing that that anyone could easily have done to produce a benchmark interest rate in a situation where no one wanted to lend to each other." The Libor affair has rocked London's reputation as a banking centre. Over a dozen banks are curerntly being investigated for their roles in setting Libor, including Citigroup, HSBC, Deutsche Bank, UBS and Royal Bank of Scotland. Joanna Partridge, Reuters