Speculation grows that Barclays will be bailed out as investors 'throw in the towel'

mzqa395

Shares in Barclays plunged again yesterday amid mounting speculation that the Government is preparing to take a stake in the undersiege bank.
They tumbled 8p to 51.2p, falling for the ninth consecutive trading session, completing a run that has seen Barclays lose nearly three quarters of its stock market value in just 12 days.
The latest fall came hours after John Varley, the chief executive, made a fresh attempt to prop up confidence in his bank.
He told Cantos, the online financial broadcaster: “The Financial Services Authority, acting on behalf of the tripartite authorities [the FSA, the Treasury and the Bank of England], ensures that they understand very intimately what’s going on in terms of the way in which the business is being run and that they have good disclosure and good transparency relating to our balance sheet.

“That’s an obligation that we take with deadly seriousness because, if we were not honouring that obligation, believe me, we would not be allowed to do business, simple as that.”


Mr Varley also emphasised that, if Barclays took part in the Treasury’s planned asset guarantee scheme, it would prefer to pay cash to use the facility rather than issue shares to the Government.
But analysts and investors now believe there is a strong possibility of at least partial nationalisation of Barclays. The Times has learnt that Mr Varley has held talks with the Treasury in the past 48 hours after being asked to provide further reassurance over the bank’s financial position.
Sources close to Barclays said: “This was a normal meeting to discuss a range of issues, not least the Government’s new stimulus package. The notion that John was summoned or that this was a crisis meeting is nonsense.”
With rumours circulating in the City that Mr Varley would have to step down in the event of the Government taking a stake in the bank, Whitehall insiders last night played down suggestions that the Treasury had any immediate intention of intervening. However, sources said that it could “plausibly” be the case that the Barclays board might “see a problem that needed to be fixed”.
But traders and analysts said that the market appeared to have lost confidence in Mr Varley. Manoj Ladwa, a derivatives broker at ETX Capital, added: “Investors are throwing in the towel on the banking sector, and Barclays in particular.”
Sandy Chen of Panmure Gordon – one of the bank’s sternest critics in the analyst community – said: “Barclays has a very similar business model to RBS and so the read-across from the RBS figures is what has hit Barclays shares.”
Mr Chen said that, to regain trust, the bank needed to “mark to market” the value of some assets on its balance sheet – in other words, show them in the books at their current market price. Barclays has been reluctant to do this, arguing it plans to hold many of its toxic investments to maturity.
Despite speculation that the expiry of the ban on short-selling of financial shares was responsible for the recent collapse in Barclays’ price, the tripartite authorities are said to be satisfied that the fall was a result of traditional fund managers selling stock.
Philip Hammond, Shadow Chief Secretary to the Treasury, told The Times: “The Government’s plan is too late and too lacking in detail to reassure the markets.”

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article5576421.ece

ahai1

Inactive it seems that Barclays wont be a smug unethical bank anymore. They will have to eat humble pie.

Browntoa

cannot see them completely nationalising it though and peeing off a major arab state who own 33%

Inactive

ahai1 wrote: »

Inactive it seems that Barclays wont be a smug unethical bank anymore. They will have to eat humble pie.

Indeed, it looks that way, at least it will perhaps take the arrogant smile from John Varleys chops.;)

ahai1

He will become another begger. I wonder if the staff are still proud to work for Barclays. Afther all they were proud to work for a bank that did business with white racists in South Africa so this should not make much difference.

chambta

ahai1 wrote: »

He will become another begger. I wonder if the staff are still proud to work for Barclays. Afther all they were proud to work for a bank that did business with white racists in South Africa so this should not make much difference.

If they balance it out by doing business with black racists in Zimbabwe would that be ok?

Not trying to be provocative. Just playing devil's advocate.

naijapower

chambta wrote: »

If they balance it out by doing business with black racists in Zimbabwe would that be ok?

Not trying to be provocative. Just playing devil's advocate.

No need to play devil's advocate. Race is a sensitive issue. Not one should joke about or open unnecessary coment/debate on.

Mike1989

ahai1 wrote: »

He will become another begger. I wonder if the staff are still proud to work for Barclays. Afther all they were proud to work for a bank that did business with white racists in South Africa so this should not make much difference.

By no means am I justifying what happened in South Africa or any other country that a oppressive regime has caused harm, and banks have continued to deal with. But if we take the notion, are staff proud to work for Barclays after what Barclays did in South Africa, that would mean are current German politicians proud to work for the German government after they committed atrocities in the build up to world war II and during the war? By that same notion are British politicians proud to work for the government after we took a fair whack of the world under our empire and exploited them.? See the problem with your argument?

Just because someone works for Barclays does not mean they agree with what they did in South Africa, nor does it mean they agree with the bank's lending policy or bonus policy for their executives. In some cases they need the job for a mortgage, in others it was the best they could get, or in some cases they just wanted to work in a bank. It is not possible to go around and work for companies that have been 100% ethical throughout their history.

I would not throw their graduate scheme out of the window because they did business with South Africa during apartheid. Just like I wouldn't throw a gradate scheme with Lloyds out of the window because they had a dodgy deal recently that they have been fined for. Because if the notion I am to undertake on any job is to work for a company that has been 100% ethical, I'd end up having a hard time finding one and so would countless other men and women in this country when looking for jobs.

Don't get me wrong, I do not justify companies or governments continuing to do business with oppressive and racist regimes. But it was not Barclays place to oust those that were in power in South Africa. Nor do staff at Barclays, Lloyds, Halifax, RBS, NatWest etc agree with what their superiors do in many cases. I'm sure Halifax workers never want to hear the name Andy Hornby again. And to be fair, it is not right to place the onus on staff who work for Barclays as working for a bad company and are somehow in the wrong for doing so. It is their job and I'm sure most of them are proud to be apart of the company doing the job that they do. At least they are working and contributing to the economy.

chambta

naijapower wrote: »

No need to play devil's advocate. Race is a sensitive issue. Not one should joke about or open unnecessary coment/debate on.

I wasn't joking. Is it you that decides what comment or debate is necessary?

ahai1

If you are proud to work for someone like Barclays then you should be proud of the companies ethics. As for the German companies they are no longer involved in working with people like Hitler.

Mike1989

ahai1 wrote: »

If you are proud to work for someone like Barclays then you should be proud of the companies ethics. As for the German companies they are no longer involved in working with people like Hitler.

I suggest reading my post and then post your own in future. Because I never said German companies, I said German politicians working for the German government. Hitler worked for the German government, he committed atrocities against the Jews and other undesirables. Therefore, are German politicians in this day and age ashamed of working for the German government? Should they do it? Can they be proud of doing it after what Hitler did in the government, after what Bismarck did and so on and so forth?

On your opinion, no they cannot be proud of working for the government. Them working for the government instantaneously means they agree with what Hitler and to an early degree Bismarck did. But in many cases that is not true! They do not agree with what Hitler did because they work for a government that have previously been oppressive. They have a job and they are proud of doing that job, and it does not mean they agree with what their predecessors did.

The same goes for Barclays workers. They do not have to agree with what that company does. They cannot make the decision were they bank with, what countries they operate in and so on. It does not mean because Mr X who works at Barclays agrees with their ethics, he might work there because he is a good salesmen or he needs a job. Mrs X works for Barclays as a manager, she does not need to agree with that Mr X does as a manager, nor does she need to agree with what the executives do. The workers are not tied to what Barclays did in South Africa, which if you cared to understand, was merely operate a bank. So they did not say, here you go Mr Racist you continue to abuse people. Likewise they do not stay in Zimbabwe because they support Robert Mugabe oppressing white and black Zimbabweans. There is a distinct difference and you appear to naive to actually accept there is a difference between working for a company and being proud to have a job, and not having to agree with everything that company does.