Page last updated at 08:03 GMT, Tuesday, 18 November 2008

Barclays' board faces re-election

Barclays bank branch

Barclays' board is to offer itself for re-election at its AGM next spring following a 7bn capital-raising plan.

In October Qatar Holding and HH Sheikh Mansour Bin Zayed Al Nahyan agreed in October to invest billions in Barclays.

The bank will now make 500m in high-yielding securities available to other institutional investors.

Barclays executive directors, including president Bob Diamond and chief executive John Varley, will not take any bonus for the 2008 financial year.


Unlike other big UK banks, Barclays did not want to accept a bail-out from the UK government and had previously said the move to raise cash from the Middle East would keep it "strong and independent".

It has now said that the Middle Eastern investors want other institutional investors to be able to participate further in the capital raising, something Barclays has agreed to do.


There had been some disquiet from institutional investors about the form of the capital-raising exercise.

On Tuesday, Barclays said in a statement: "A number of meetings and conversations have taken place between senior officers of Barclays and Barclays major institutional shareholders.

"The discussions have been constructive and the board of Barclays has listened carefully to shareholders' views."

Government stakes

All directors will offer themselves for re-election at the AGM in April rather than just a third of them as would normally occur.

The decision of the board to stand for re-election means that shareholders now have a means of expressing their unhappiness, should they wish to do so.

The government is injecting up to 37bn into Royal Bank of Scotland, Lloyds TSB and HBOS to avoid a collapse of the banking sector.

However, in return for the rescue, they must give major stakes to the government and halt cash bonuses for bank board members this year.

HSBC, along with Barclays, opted not to seek cash from the government.

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