In order to try and balance their accounts Barclays are looking to raise in the region of GBP4 billion from external investors. This is to avoid using a rights issue which could seriously affect their share price.
Barclays Bank currently has one of the lowest capital reserves figures in the industry and will certainly face stiff criticism if this is not being seen to be addressed. Criticism tends to equal falling share prices and the bank do not want to see their position further weakened by such activity.
The bank has many facets to its business, with Barclays Insurance, stockbrokers and high street banking just a number of the best known. There is no question that they are operating well but in the current economic climate and with other financial institutions having suffered already it is important that Barclays can source this additional funding.