LONDON: Barclays chief executive Bob Diamond has resigned with immediate effect over a rate rigging scandal at the British banking giant, the company said on Tuesday.

“Barclays today announces the resignation of Bob Diamond as chief executive and a director of Barclays with immediate effect,” the bank said in a statement to the London Stock Exchange.

US national Diamond added in the statement: “The external pressure placed on Barclays has reached a level that risks damaging the franchise—I cannot let that happen.”

Diamond's resignation follows that of the bank's chairman Marcus Agius on Monday and as the bank faced possible criminal prosecution in a scandal that has sullied London's image as a financial centre.

Britain's Serious Fraud Office on Monday announced that it was considering whether it was “appropriate and possible to bring criminal prosecutions” over the issue, adding that it hoped to reach a conclusion within a month.

British Prime Minister David Cameron also announced a parliamentary inquiry into the revelations that Barclays traders had lied about the interest rates other banks were charging it for loans.

The scandal, which might implicate other international banks, concerns manipulation of the Libor and Euribor rates which play a key role in global markets, affecting what banks, businesses and individuals pay to borrow money.