MISERY LOVES COMPANY. So in the wake of the Lehman Brothers’ collapse, when first RBS and then Lloyds Banking Group were brought down by billions upon billions of pounds of credit losses and forced into majority ownership by the government, UK bankers reasoned that Barclays must soon join them.
It was extremely unlikely, they suggested, that Barclays could have avoided the worst blows of the credit crisis. And if the damage wasn’t showing up in its published results yet... well, who in their right mind would still believe any bank’s numbers? This, after all, was the same Barclays management team that nearly bought ABN Amro, only to be beaten to the worst prize in the history of banking M&A by Fred Goodwin’s RBS.
Barclays has had a lot of near misses. It nearly failed to raise the equity all UK banks were required by the Financial Services Authority to find last October to improve their capital ratios. In the process, it nearly surrendered its operational independence to the government by taking taxpayers’ money. But it didn’t. It raised capital from sovereign wealth funds in the Middle East instead and cut its dividend.
