Bob Diamond was fighting to keep his role at the top of Barclays on Monday night, insisting he was the right person to see through reform at the bank despite growing calls that he should quit.

Some investors are arguing that when a successor is found for chairman Marcus Agius, who quit on Monday, one of that person's first tasks should be to appoint a new chief executive and clean out other members of the executive committee.

The bank is also considering ways to heed calls from shareholders to claw back bonuses from Diamond, pictured below, or scale back future rewards in order to defuse the political storm around him. He has already forfeited his 2012 bonuses.

In a memo to staff, the American-born chief executive said he was sorry and angry about the revelations disclosed by regulators about Barclays's attempts to manipulate key interest rates as long ago as 2005, which forced Agius's resignation.

Diamond, who is preparing to face MPs on the Treasury select committee tomorrow, said: "I love Barclays, and I am proud of all of you. We all know that these events are not representative of our culture, and it is my responsibility to get to the bottom of that and resolve it.

"Make no mistake the actions taken in this incident were against all of the principles we live by."

In an effort to show changes were under way before the audience with MPs, Diamond pledged to bring in a "zero-tolerance policy" against staff who damage the bank's reputation and a new code of conduct for all employees.

Reflecting the grim mood descending on the industry, the British Bankers' Association cancelled the summer party scheduled for tomorrow, the day before MPs also question Agius, who resigned as chairman of the BBA .

Angela Knight, BBA chief executive, told invitees: "Our industry needs to think long and hard about its collective behaviour and I am sure you understand this is not the time for such an event to take place."

The business secretary, Vince Cable, kept up the pressure on the industry, telling an insurance industry audience that senior figures "still don't get it".

Barclays elevated its non-executive director Sir Michael Rake to deputy chairman to oversee an independent "root and branch" review of its culture and "flaws" in its practices, which will be published.

Diamond said: "We will use the output of that review to adjust our HR processes so that the standards that emerge play a material role in hiring and induction; assessment and development; and reward. That will start with executive management."

Rake is seen as a potential replacement for Agius, who is staying on until a successor is found. The search is being led by former Cadbury boss Sir John Sunderland who will also seek external candidates.

Sir Stelios Haji-Ioannou, the founder of easyJet, called on Rake to stand down as chairman of the budget airline.

Diamond's appearance before MPs – where he is being urged to show contrition rather than repeat previous bravura performances at the committee – is regarded as crucial if he is to remain at the bank after more than 15 years, 18 months of them in the top role .

Gary Greenwood, banks analyst at stockbroker Shore Capital, said Agius's departure would "do little to appease the many who see Bob Diamond as having primary responsibility". Labour leader Ed Miliband led the calls for Diamond to go.

The bank's shares, which fell more than 15% in two days last week – gained more than 3% yesterday but investors were preapring for change in the sector. Few were ready to speak openly and some are fearful that other banks in the crisis may need to embark on full-scale change at the top.

Euan Sterling, investment director at Standard Life Investments, told the BBC's Today Programme: "I really think it's important to get to the bottom of this ... I think Barclays has become the poster child for this because they have been the first to be assessed by the regulators on both sides of the Atlantic, but I this is going to spread far and wide through out the industry".

Diamond is expected to use this defence before MPs, when he is also expected to be asked about a conversation with Bank of England official Paul Tucker about the London interbank offered rate (Libor) that is at the centre of last week's record-breaking fine from the Financial Services Authority and the US authorities.

He admitted he had not seen the full findings of the regulatory reports that led to the fine until just before they were published. The reports, by the FSA and the US Department of Justice and Commodities Futures Trading Commission, published emails showing Barclays traders changing interest rates with offers of Bollinger champagne.

"The events revealed last week arose in large part because we did not have appropriate controls in place," Diamond said. "Frankly, we misjudged the risk associated with the underlying activity. That must never happen again. Once we better understood the risks, we put in place the right controls and systems."

He has forfeited his 2012 rewards to try to defuse the row around the fine, and there is speculation that an attempt to claw back bonuses could be announced before the Treasury select committee hearing chaired by the Conservative MP Andrew Tyrie, who is running the new parliamentary inquiry into banks.

An investigation has also been launched into the way that Libor is set by asking a panel of banks the price at which they expect to borrow money from each other, instead of the actual price at which they borrow.

FSA executive Martin Wheatley will run the investigation, which will report by the summer.