Fallout: The Financial Crisis

Barclays finds support in Middle East

Stephen Beard Oct 31, 2008
HTML EMBED:
COPY
Fallout: The Financial Crisis

Barclays finds support in Middle East

Stephen Beard Oct 31, 2008
HTML EMBED:
COPY

TEXT OF STORY

Scott Jagow: If you’re a bank and you don’t want to take money from your own government, how about getting it from someone else’s? That’s what Barclays, the British bank, is doing. Today, Barclays said it’s getting $12 billion from the Middle East. Our man in London, Stephen Beard, has more.


Stephen Beard: Barclays is planning to raise the money mainly from sovereign wealth funds in Quatar and Abu Dhabi. The bank had earlier talked about deals with Russian and even Libyan investors.

Anyone, it seems, rather than the British government. Barclays rebuffed the offer of British taxpayers’ cash, because that would involve the government taking a stake in the bank — and that, says Andrew Hilton of the CSFI think tank, would have strings attached.

Andrew Hilton: In particular, limitations on dividends. Certainly having somebody looking over your shoulder when it comes to executive remuneration. And on both of those counts, I think the people who run Barclays would rather go to the private markets than have the government’s discipline imposed upon them.

He says that banks both in Britain and the U.S. feel that seeking help from their own governments is a desperate last resort.

In London, this is Stephen Beard for Marketplace.

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.