Diamond defends BarCap against ‘casino’ allegations

BARCLAYS’ Bob Diamond at the weekend lashed out at the criticism he has received since being appointed as the group’s new chief executive last week.

Diamond, who currently heads up the investment banking arm Barclays Capital, said references to the division as a “casino” were misleading and disappointing.

“Words like ‘casino banking’… have no basis in reality and generally come from people that don’t understand what a bank does and how important risk is in terms of the business we do with our clients,” he told the Sunday Telegraph.

“It’s disappointing when we hear reference that Barclays Capital is a casino – we closed down our proprietary trading in 1998.”

Diamond, who is due to replace outgoing chief John Varley in April next year, insisted that the group would cooperate with the banking commission on its inquiry into the structure of the sector in the future. But he reiterated the group’s support for the universal banking model, adding: “We have a very strong view that our business model fits exactly what is the right model for the UK.”

Since the crisis, the integration of retail and investment banking operations under one roof has been a particular bugbear for politicians who believe it increases risk in the system.