Thursday, October 30, 2008

Barclays in talks to raise £6 billion

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British bank Barclays Plc is close to raising about £6 billion ($9.8 billion) from a number of potential investors and could announce
details on Friday, a person familiar with the matter said.

Barclays has been in talks with a mix of existing and new investors, the source said, but declined to identify them.

Existing investors expected to invest more in the bank are likely to include Qatar's sovereign wealth fund, after it invested in the summer.

Libya is not expected to invest, the source said.

The Financial Times reported on Friday the Libyan Investment Authority was likely to be an investor. Barclays declined to comment.

Earlier this month, it said it would raise capital but would raise the funds privately rather than take government cash.

Rivals Royal Bank of Scotland, Lloyds and HBOS are all taking billions in taxpayers' funds to help weather the financial crisis.

Barclays said when the government's recapitalisation plan was announced that it planned to raise about £6.5 billion, with about half from preference shares and half from the sale of ordinary shares.

The bank has lost billions of pounds from credit-related asset writedowns and is faced with a sharply slowing UK housing market and economy, but it has fared better than many rivals. It has raised funds from investors in China, Singapore and Japan as well as Qatar.

The bank expects to gain a competitive advantage by raising capital privately, while RBS and others will have the government as a major shareholder

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