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Updated at 7:50 am on 10 July 2012
Bank of England deputy governor Paul Tucker has denied giving Barclays Bank instructions to lower its Libor submissions in 2008.
He told a parliamentary hearing into the rate fixing scandal that he had no idea that inter-bank rates were being manipulated and that the scandal came as a deep shock to him when he first learned about it a few weeks ago.
He also said that the bank and the government feared that Barclays may need a bailout.
RBS, HBOS and Lloyds had to be bailed out by the government in the middle of October 2008, and there was concern that Barclays could be "next in line".
As for a conversation on 29 October, 2008, with Barclay's former chief executive Bob Diamond, Mr Tucker said he did not think Mr Diamond was telling him that other banks were faking their interest rate submissions.
He said he did not see Mr Diamond as a whistle blower, blaming the other British banks at the time.
Mr Diamond's note of the call concluded by saying Mr Tucker had stated that ''it did not always need to be the case that we appeared as high (with Libor submissions) as we have recently''.
Mr Tucker told the Treasury Select Committee that, unlike Mr Diamond, he had not made a note of the conversation.
''I think the last sentence gives the wrong impression,'' he said.
The BBC reports Barclays was trying to manipulate Libor rates during the height of the financial crisis, by submitting lower borrowing rates.
These rates, submitted by a number of banks, go into calculating the daily Libor, or London Inter-Bank Lending Rate, which is the basis for millions of daily financial transactions.
Copyright © 2012, Radio New Zealand
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