Barclays defends business
Barclays defends business
Monday 26th January 2009
Barclays has defended its business in an open letter to shareholders as the bank's share price continues to fall.Over the last two weeks, shares in Barclays have lost two-thirds of their value following a new crisis in the banking sector.
In a bid to support the share price, chief executive John Varley and chairman Marcus Agius have written an open letter to shareholders confirming "significant" pre-tax profits for the year, with the results release brought forward to February 8th.
Profits, which will be ahead of the market consensus of £5.3 billion, will include £8 billion of writedowns, Barclays said.
"These figures demonstrate that although we have been heavily impacted by the credit crunch, our income generation was at a record level in 2008 and has enabled us to withstand this impact and still produce strong profits," the executives said in the letter.
Mr Varley and Mr Agius also said the bank has no plans for further capital raising, either from shareholders or the government and insisted the bank's capital base remains strong.
The bank has also had a "good start to 2009", the letter stated.
Analysts view Barclays as being relatively conservative in its writedowns so far and the bank has not sought government cash, instead going to existing shareholders and sovereign wealth funds for capital.
However, after Royal Bank of Scotland warned losses in 2008 would exceed expectations, investors lost confidence in the sector and Barclays shares were particularly hard hit.
At 08:08 GMT, Barclays' shares were trading 25 per cent higher at 64.40p.
Related News
Unemployment 'could reach three million', economist warns - 25/01/09
An economist who warned Bank of England colleagues of an imminent recession has said he fears unemployment could reach three million in a year's time
An economist who warned Bank of England colleagues of an imminent recession has said he fears unemployment could reach three million in a year's time
Britain enters recession - 23/01/09
Britain has officially entered recession for the first time since 1991 as the economy shrank by 1
Britain has officially entered recession for the first time since 1991 as the economy shrank by 1
FTSE 100 loses early gains as Dow drops - 22/01/09
The FTSE 100 gave up early gains this afternoon and the Dow Jones pushed aside yesterday's optimism and dropped
The FTSE 100 gave up early gains this afternoon and the Dow Jones pushed aside yesterday's optimism and dropped
British Gas cuts gas prices by 10% - 22/01/09
British Gas is to cut its gas prices by ten per cent from February 10th
British Gas is to cut its gas prices by ten per cent from February 10th
Renewed fears over short-selling follow banking collapse - 22/01/09
Fears over hedge funds short selling bank shares have prompted frantic activity in the corridors of Westminster
Fears over hedge funds short selling bank shares have prompted frantic activity in the corridors of Westminster
News Article Search
Quick Apply
News Archive