Barclays sets date for £5.8bn rights issue

Tim Wallace
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THE BIGGEST bank fundraising round since the financial crisis will take place on 13 September, Barclays announced yesterday.

The lender is raising £5.8bn in a major rights issue, shoring up its capital position after regulators argued the bank needed to improve its leverage ratio.

Existing shareholders will get the first chance to buy as they will be offered one share for every four they currently hold.

Barclays had been seen as a safe, secure bank by markets.

But the Bank of England’s prudential regulation authority (PRA) reviewed the capital positions of the UK’s biggest banks under stressed conditions and said Barclays had a £12.8bn hole.

This share issuance will solve much of that gap. Barclays is also taking other steps to improve its position, reviewing its business units to remove those with insufficient returns to stay in the group under the tougher new constraints.

That has resulted in the group announcing the sale of its UAE retail banking unit, a business which had previously been deemed sustainable.

Barclays’ shares rose 1.56 per cent on the day to 289.55p.