September 2008: On September 17, Barclays announced its agreement to purchase Lehman Brothers' investment banking and trading divisions. On September 18, it successfully placed 226 million shares, raising approximately £700 million to give Barclays the capital necessary for the Lehman acquisition. October/November 2008: Barclays launched a further round of capital raising, approved by special resolution on November 24, as part of its overall plan to achieve higher capital targets set by the FSA to ensure it would remain independent, and raised £7 billion from investors from Abu Dhabi and Qatar.
The week Wall Street capitulated
In October the credit crunch finally devastated global equity markets as investor panic threatened to bring down all but the very strongest banks. Alex Chambers was pounding the sidewalks of New York just as the crisis entered its most tumultuous period and perhaps its denouement.
Winners and losers in the scramble for investment banking revenue
Barclays Capital, now including substantial remnants of Lehman, has risen one place from ninth in the first quarter 2008 to eighth this past quarter with revenues 36% down on the comparable quarter in 2008.
Barclays: The bank that lived
Barclays was the bank that many expected to fail. Recapitalized, with its earnings power enhanced, safe from the clutches of the UK taxpayer, it may emerge as one of the big winners from the crisis. The banks leaders expect to build dominant positions in both retail and investment banking. What could still throw Varley, Diamond & Co off course?
Barclays, which purchased the US broker/deal operations of Lehman, has fared better than Nomura. In its first quarter 2009 interim management statement, Barclays wrote: "The acquisition and successful integration of the Lehman business resulted in a transformational change in Barclays Capital where profit before tax was very substantially ahead of last year, rising 361% to £907 million." A source said: "Barclays bought the essence of Lehman its US franchise. Nomura bought the rest."
Brilliant Bob Diamonds luck finally runs out