Barclays wraps up 5.8 bln stg cash call to bolster capital

Reuters

* Barclays says 94.6 pct of shareholders subscribe to rightsissue

* "Rump" placing worth 463 mln stg sold at 268 pence/share

* End of 5.8 bln stg rights issue to meet leverage ratiorules

* Shares down 0.1 pct at 272p

By Steve Slater

LONDON, Oct 4 (Reuters) - Barclays completed its5.8 billion pound ($9.4 billion) fundraising on Friday to meet acapital shortfall identified by its regulator, after almost 95percent of the British bank's investors stumped up more cash.

Barclays launched its rights issue three weeks ago, promptedby the British regulator's demand that it improve its leverageratio - a measure of its capital to assets - to 3 percent bymid-2014.

Barclays said bookrunners for the offer sold the shares thatwere not taken up by investors - worth 463 million pounds - at268 pence apiece, or a 1.8 percent discount to Thursday's close.

Barclays shares were down 0.1 percent at 272.8p by 1110 GMT,which dealers said was a resilient performance and reflected themodest size of the leftover shares.

The bank also plans to sell 2 billion pounds of bonds thatconvert into equity if the bank hits trouble and to shrink thebalance sheet of its investment bank to help it meet itsleverage ratio target.

"Post the rights issue the regulatory risks have beenreduced but not eliminated," said Mike Trippitt, analyst atNumis Securities, saying there could be "pressure to deleveragethe business further".

The rights issue was the biggest by a British bank since2009 and raised the equivalent of 15 percent of Barclays' marketvalue.

Antony Jenkins, who took over as chief executive a year ago,is trying to rebuild Barclays' reputation after a string ofscandals. He said the rights issue would deal "quickly anddecisively" with the British regulator's demands.

CHALLENGES

Investors have broadly welcomed his turnaround plan,although he still faces challenges to improve profitability andtackle a raft of legacy issues. The rights issue forced him topush back his target to deliver a return on equity above about11.5 percent by a year to 2016.

A slowdown in income from selling bonds and interest rateproducts, the core business for investment banks, will hurtthird quarter profits across the industry.

Barclays' rights issue prospectus also said it faced a 50million pound fine from Britain's Financial Conduct Authorityfor its failure to adequately disclose fees it had paid Qatariinvestors over the last five years.

Those fees, linked to fundraising in 2008, continue to beinvestigated by other authorities in Britain and the UnitedStates.

Qatar Holding invested 5.3 billion pounds in twofundraisings, which helped it avoid the government bailouts ofrivals Lloyds and Royal Bank of Scotland.

It is still Barclays' biggest shareholder with a 6.3 percentstake and subscribed to buy more shares in the rights issue tomaintain its stake, but did not buy any extra, a person familiarwith the matter said.

Investors in China, Hong Kong, Japan and South Africa werenot allowed to buy shares in the offer because Of local laws.China Development Bank and Japan's Sumitomo Mitsui areamong the bank's top 20 shareholders after investing in 2008,and it was unclear if they could participate through a nomineeholder.

Advisers on the rights issue were Credit Suisse, DeutscheBank, Bank of America Merrill Lynch, Citi and Barclays itself.

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