Barclays announced that it was selling its UK life insurance business to Swiss Re for £753 million ($1.48 billion).
On Saturday, June 21 (Tokyo time), it was reported that Barclays would be receiving 100 billion yen ($925 million) from Japanese firm Sumitomo Mitsui Financial Group. Barclays will create new shares, which will give Sumitomo Mitsui a minority stake in the British bank. The two firms will also begin to combine their business efforts in certain markets, like their asset management business in India. (1)
Barclays announced on Monday, June 16, that existing shareholders may be able to buy shares of the company in a private offering to shore up capital. Before, it was rumored that Barclays would only sell shares to sovereign wealth funds, which would dilute existing shareholders' value. Additionally, the firm said that its pre-tax profit in May 2008 was "well ahead" of its pre-tax profit in the same month in 2007.[1]
On June 9, 2008, two anonymous sources stated that Barclays may sell additional shares of itself to shore up capital after taking significant write-downs on risky assets. According to analysts at Lehman Brothers and Citigroup, Barclays needs to raise at least 7 billion pounds ($13.8 billion) to strengthen its balance sheet.[1]
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An analyst with Goldman Sachs lowered his target price for Barclays on Friday, November 16. Despite the smaller-than-expected write-down announced on November 15, the Goldman analyst reiterated the potential impact of continued turmoil in the U.S. housing market and global markets on Barclays future performance.
Following speculation of large write-downs on Friday, November 9, Barclays denied these rumors and promised to announce updated results on Thursday, November 15; this helped the company's stock regain the previous week's losses. In the release, Barclays announced combined write-downs of $2.7bn (1.3bn pounds) for both the third quarter and October. This was much less than expected, but the firm's stock price fell again amid fears about future growth prospects.
On Friday, November 9, speculation about large write-downs sent shares of Barclays down sharply. Some reports estimated Barclays write-downs at up to $10 billion. Additionally, rumors circulated that top management at Barclays would be stepping down, as has happened at Merrill Lynch and Citigroup. Barclays denied both of these rumors.
Blackstone Group will purchase Barclays stake in India-based call center operator Intelenet at close to $200 million. Intelenet was originally intended to help Barclays set up its own India-based administration unit.
Due to a lagging share price of its stock, Dutch bank ABN Amro is under pressure from shareholding hedge funds to accept bits for mergers and acquisition. Barclays has placed an informal inquiry for acquisition.
In an entirely cash transaction, Barclays will acquire Regions Financial Corporation’s non-prime mortgage origination business, EquiFirst. The transaction is expected to be completed in the first half of 2007 for about $225 million.
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