Former Barclays chief executive Bob Diamond has acknowledged there were "mistakes" and "reprehensible" behaviour at the bank, in his first public comments since quitting the company.

Mr Diamond faced the British parliament's treasury select committee overnight to answer questions about the bank's manipulation of Libor, a key interbank lending rate.

He blamed 14 rogue traders at Barclays for the scandal, which has seen the bank fined $440 million.

"Clearly there were mistakes, clearly there was behaviour that was reprehensible," he told the committee.

Mr Diamond told Conservative MP David Ruffley he first discovered the rigging of Libor "this month", and was "physically ill" when he learned the full detail.

"I got physically ill. It's reprehensible behaviour. And if you're asking me should those actions be dealt with, absolutely," he said.

"But I want to assure you, David, that behaviour was reprehensible, it was wrong. I'm sorry, I'm disappointed and I'm also angry."

Labor and Conservative committee members questioned the American-born banker's track record.

"It raises the question, you as chief executive, why on Earth didn't you know that this was going on on your watch?" Mr Ruffley said.

"You must have grossly incompetent in your job during that period of time, if you weren't complicit in this," Labour MP John Mann said.

"So is there a question?" was Mr Diamond's rejoinder.

He said that while there had been "mistakes", Barclays acted quickly to tackle the problems as soon as the scandal came to light.

"The attitude of Barclays three years ago when this was recognised was, let's get to the bottom of it," he said.

The three-hour hearing was broadcast live and Mr Diamond was determined to defend the bank.

"I love Barclays. History will judge Barclays as an incredible institution because of its people," he said.

Labour MP Teresa Pearce appeared incredulous.

"Mr Diamond, you've told us repeatedly that you love Barclays. But from what it seems, you're saying that you don't know anything that was going on, it seems... you've not even met Barclays, let alone love Barclays," she said.

"You just keep saying I didn't know, I didn't know... I wasn't aware."

Mr Diamond replied: "I'm saying more than that. I am talking a lot about what we did about it and how we behaved. I think that's unfair..."

But he acknowledged that a "no jerks" ethical recruitment rule at Barclays had failed to stop the wrongdoers.

High risk, high reward

Mr Diamond was Britain's highest paid boss and had been credited for the high risk, high reward ethos adopted by Barclays.

He quit as chief executive of the British bank on Tuesday, the same day as the firm's chief operating officer Jerry del Missier.

They stepped down after chairman Marcus Agius resigned on Monday, but was then rehired to find a new chief executive.

The drama follows the scandal surrounding several Barclays employees manipulating the benchmark London Interbank Offered Rate (Libor).

Libor underpins hundreds of trillions of dollars of interest rate-related financial contracts, and is supposed to be an honest estimate of the interest rate at which banks will lend to each other.

Barclays was fined a total of around $450 million by US and British financial regulators last week after it emerged that it had on many occasions submitted Libor estimates that were deliberately low or high on the request of traders who stood to profit from the moves.

Mr Diamond was forced to quit after intense pressure and a tap on the shoulder from the Bank of England.

But questions have been asked about the role of Britain's central bank, the Bank of England, and whether it gave tacit encouragement to the activities.

Mr Diamond also told the inquiry he was concerned that British officials could have misunderstood what he said was a situation of adequate funding for Barclays in 2008 at the height of the financial crisis which is at the centre of the allegations.

He said this could potentially have led to the nationalisation of Barclays, as happened to other British banks like Royal Bank of Scotland.

"If Whitehall then was told Barclays was at the highest of Libor, [officials might have told themselves] 'my goodness they can't fund, we need to nationalise them' as they had nationalised other British banks," Mr Diamond said.

Mr Diamond was also asked by MPs given the circumstances of his resignation if he would give up a potential $30 million payout. He said that was a matter for the bank's board.

ABC/AFP