In a crammed room, which spectators had to queue to enter, Barclays’ incoming chief executive refused to commit to again waiving his bonus – and said Barclays would not quit London even if the bank was ordered to break up.
Diamond, striking an at times defiant tone, defended the role of bankers in a successful economy, in a grilling by the Treasury Select Committee over bonuses.
"There was a period of remorse and apology for banks and I think that period needs to be over. We need our banks willing to take risks ... so we can create jobs," Diamond told the committee.
Diamond said taxpayers should never have to bear the burden when a bank lands in trouble, reflecting global efforts to inflict more pain on bondholders in case a bank lands in trouble and not bail them out with taxpayer money.
"No bank should ever be a burden on the taxpayer," he said.
He defended the universal banking model that combines retail and investment banking and which is under pressure internationally from financial regulators, which are keen to separate out the two divisions into “narrow” banks.
He said it provided more stability and offered the strong growth the UK economy needed.
“The best thing that Barclays can do for the UK economy and for UK jobs is to have a strong bank with strong risk management,” he said.
Diamond also hit out at reports that Barclays would consider moving its headquarters away from the UK if the Independent Commission on Banking recommended splitting banks.
“I am crystal clear. Barclays took its first deposit in the City of London in 1690 and we have absolutely no intention of changing that. We are going to work closely with the Banking Commission to convince them that customers are benefiting from having a choice,” he said.
Pay was the hot topic as expected in the at times heated exchanges with 12 members of parliament on the committee, amid a political spat over bank bonuses.
The government is expected to take a more reasonable line with the major financial institutions over banker pay, but will instead seek commitments from them to lend more to small businesses.
But Diamond said Barclays could not decide how much to lend without making credit quality checks and said demand for loans had fallen as businesses opted to pay down debt or postpone large investments.
Diamond – who earned £21m in 2007 but has waived his bonus for the last two years – said he would show any restraint he could in his remuneration policy.
But asked whether he would again waive his bonus this year, Diamond told the cross-party group of politicians he would decide "with his family" whether to accept a bonus if he was awarded one.