Barclays Middle East backers question share price fall
After a multibillion pound fund raising programme in the Middle East just a short time ago, the directors of Barclays bank were under serious pressure at the time although somehow managed to contain a potentially serious rift with shareholders. However, the 40% fall in the price of the Barclays shares over the last week has seen substantial losses already for the company's Middle Eastern backers and there are concerns amongst investors that more bad news may follow.
We have still to really find out why in particular Barclays bank was hit late on Friday and while it appears to be a sector led rather than a company led problem there is still some confusion. Whether the company will now be forced to return to Middle Eastern investors with a begging bowl remains to be seen but the fact the company rejected the government's offer of a taxpayer funded cash injection could have a serious impact on the company in the short to medium term.
It is amazing to think that a company of Barclays bank's strength and standing in the UK banking sector is under so much pressure even after a multibillion pound fund raising. Such is the doom and gloom riding through the banking sector that some of the best and strongest names in the industry are under serious pressure. Another government led bailout would appear inevitable and while nothing has been forthcoming from the government as yet, this could happen any day. But will Barclays bank be allowed to participate this time around?
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