Diamond gives up 20 million pound pay-off - Update

Barclays' former Chief Executive Bob Diamond has turned down a 20 million pound severance package, according to the bank's Chairman.

Diamond quit the bank over the LIBOR fixing scandal, which saw Barclays' traders seek to manipulate inter-bank lending rates.

Chairman Marcus Agius told MPs on the Treasury Select Committee that Diamond had decided to forego any deferred bonuses, which could be worth up to £20m.

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However, in a statement released as Agius sat down in front of MP's, the bank said Diamond would receive up to 12 months' salary, pension allowance and other benefits, which could be worth up to £2m.

Barclays said Diamond would "support the transition to the new Chief Executive as necessary".

The bank's statement on the details of Diamond's pay-off reads:

"Consistent with his contract of employment, Mr Diamond will receive up to 12 months' salary, pension allowance and other benefits; and he has agreed to forgo his contractual entitlement to tax equalisation going forward.

"The board has agreed with Mr Diamond that he will not receive any future bonus or incentive awards; nor will he receive any further compensation payment in connection with the termination of his employment."

Agius told MPs Barclays had hoped Diamond and other executives giving up bonuses when the bank was fined by regulators in the UK and US would be enough.

However, he said the public outcry had shown it was "evidently not" the case.

MPs on the Committee put it to Agius that the bank's relationship with the regulator had been strained, something Agius agreed with.

But he also said the Financial Services Authority had labelled Barclays 'best in class' compared to other banks.

The Committee meeting is ongoing.