The news from Barclays gets more serious by the hour, and will have profound repercussions for the global banking industry, as well as for the region. It comes at the worst possible time for the world's financial industry.
Until now, the 300-year old British bank was generally held to have had a pretty good crisis. Of course it was affected by the turmoil in global markets that began in 2008 and is still blowing around the world today.
But it came through the credit crisis without having to seek a government bailout, unlike many others. In fact, it got itself some pretty solid new investors from the Middle East. And it picked up the remnants of the collapsed Lehman Brothers business in North America for a song.
The bank's strategists, led by the chairman Marcus Agiusand the chief executive Bob Diamond, were cheered by investors for the manner in which they picked their way through the wreckage of 2008-2009.
Now, both have quit the bank in a scandal that looks certain to have long-term consequences for Barclays, as well as some other leading names in global banking.
A government-forced dismemberment of the bank in the United Kingdom would have been unthinkable just a week ago. Now it is full-square on the agenda.
Regulators in London, as well as in the United States, found after a five-year investigation that traders at Barclays were guilty of manipulating the London interbank offered rate (Libor) for their own benefit.
Libor may sound like a quaintly British institution: a group of bankers getting together over cups of tea to decide what to charge people for borrowing. In fact, it is the main instrument that decides the global cost of capital.
It is used by all the big banks to set interest rates on a wide range of products, from mortgages and credit cards to corporate lending, through to gigantic trades in the credit markets.
Libor is used as the basic reference for transactions of financial products amounting to a mind-boggling US$350 trillion.
What especially annoyed the regulators - who slapped a $450 million (Dh1.65 billion) fine on the bank as settlement of its investigation - is that this price fixing was going on in the teeth of a financial crisis, which was supposed to herald a new regime of transparency and accountability on the part of financial professionals.
The Libor scandal is taken as proof that no such change of heart is possible in the banking profession, and that only root-and-branch surgery will force bankers to work within the rule of law, and of morality.
At Barclays, there is the increasing likelihood of a criminal investigation into the affair, asking all the usual questions: who knew what, when and how far up the organisation did this knowledge go?
But it is not just a Barclays affair. At least 20 banks on three continents have received subpoenas relating to Libor manipulation, with American regulators leading the way. There is no point in naming names: every global bank is involved in some way or other.
The climate for the world's financial industry was tough enough before the Libor scandal broke last week. Liquidity and credit remained tight everywhere on persistent worries about the economic recovery.
The travails of the European banks were already well known, with Spanish and Italian banks winning a surprising reprieve from the Germans just days ago. All those difficulties are going to be aggravated by the Barclays scandal.
For the Arabian Gulf, there are several immediate implications, none of which makes a banker's life here any easier. The 6.8 per cent stake held by Qatar, one of the Gulf institutions that bought shares in Barclays in 2008, is worth a lot less than it was just a week ago.
Conversely, Abu Dhabi's decision to sell down its holding (acquired at the same time as Qatar's) for a $1.5bn profit now looks like sensible prudent trading. But Barclays retains a key role in UAE retail, corporate and investment banking. Its problems make restructuring and project finance all the more difficult in the Emirates.
Just when it looked as though it couldn't get any worse for the "masters of the universe", they could be facing their most serious crisis since the Lehman Brothers disaster broke.