The investigation into interest rate-fixing in Britain's banks won't have the clout, or the reach, of the Leveson inquiry

Who is Andrew Tyrie?

The Conservative MP for Chichester, Tyrie is already chairman of the Treasury select committee, which has scored a number of successes during this parliament in holding bankers to account. Tyrie's intervention, for instance, helped secure the publication of the Financial Services Authority's investigation into Royal Bank of Scotland.

What is this new inquiry he is chairing?

In the face of calls by Labour for a full public hearing into the banking industry in the wake of the interest rate-fixing at Barclays, the government has named Tyrie as the head of a parliamentary committee examining professional standards in the banking industry. It will involve setting up a committee of MPs and peers. According to George Osborne, the chancellor, it will look at the existing international regulatory and competition investigations into the London interbank offered rate (Libor) and consider what lessons are to be learned in terms of transparency, conflicts of interest and culture. There is no indication of the time frame the investigation will cover, but it is to report to parliament by the end of the year.

Hasn't there just been an inquiry into banking?

Soon after the election the government set up an investigation led by Sir John Vickers to ensure that banks would not need taxpayer bailouts again and to look at competition on the high street among the banks. The proposals of the independent commission on banking recommended ringfencing high-street banks to protect them from the "casino" investment banking arm – the source of the problems facing Barclays over the fine for attempting to fix interest rates.

Why is the focus on Barclays?

The bank was fined a record £290m by the Financial Services Authority and authorities in the US last week after an investigation found that the bank had been attempting to manipulate the level of Libor, a key benchmark interest rate used around the world to help set the price at which households, individuals and businesses can borrow.

What powers will the parliamentary inquiry have?

The chancellor proposed that the inquiry examine Libor, conflicts of interest, and the culture and standards of the banking industry, but the terms of reference will be for both houses to decide. The inquiry will be able to call witnesses and "have full access to papers and officials and ministers, including ministers and special advisers from the last government", according to David Cameron. It is expected to report at the end of the year and its findings will feed into the banking bill, which will be amended to reflect Tyrie's recommendations.

What is the difference between a Leveson-style inquiry and a parliamentary inquiry?

Leveson is a public inquiry where evidence is taken under oath, in front of a judge, and where witnesses are questioned by lawyers. In other words, it is not run by politicians. While evidence at the parliamentary banking inquiry will be heard under oath (which differs from select committee hearings) and will be conducted by a cross-party committee from both houses of parliament, the government is likely to come under fire for not establishing an independent inquiry.

What do the banks think?

Sir Philip Hampton, the chairman of bailed-out Royal Bank of Scotland, said it was "very sensible" to look at some of the failings of the banking industry. In private, other bankers have conceded that a parliamentary inquiry is preferable to a Leveson-style investigation, although they lament that five years after the banking crisis they are still facing investigations into their ethics and culture.

When will the inquiry start?

First there will need to be a motion before both houses of parliament to agree to set up the joint committee of MPs and peers. Members of the committee will also need to be selected. Before then, Tyrie will be chairing the meeting on Wednesday of the Treasury select committee that will grill Barclays boss Bob Diamond over his knowledge of and role in the Libor scandal. Marcus Agius, the chairman who resigned on Monday, will appear on Thursday.