By Adam Clark

 

Barclays PLC (BARC.LN) on Thursday struck back against activist investor Edward Bramson's campaign for a board seat, denying that it plans to pour more money into its embattled investment bank and warning against destabilizing its strategy.

The British lender accused Mr. Bramson of having a "flawed understanding" of the banking industry in a response to the activist's public plea for Barclays shareholder support earlier this week.

Mr. Bramson's Sherborne Investors vehicle has built up a 5.5% stake in Barclays to push for a scaling back of the investment bank, where returns are lower than in its retail-banking business.

In its response, Barclays said Sherborne has used derivatives to make its investment and argued that Mr. Bramson's interests are misaligned with other shareholders. The bank called on investors to support its current strategy for the investment bank, which include Chief Executive Jes Staley taking direct supervision of the unit.

"Essentially we have a leveraged investor seeking enhanced returns by disrupting the deliberations of the board in favor of its specific interest," Chairman John McFarlane said.

Mr. McFarlane also said Barclays doesn't intend to commit significantly more financial resources to the investment bank, after Sherborne claimed the lender could be forced into raising equity or debt to finance the unit.

The vote on Mr. Bramson's appointment is due on May 2 at Barclays' annual general meeting but no other major shareholder has yet come out in favor of the activist's plans.

 

Write to Adam Clark at adam.clark@dowjones.com

 

(END) Dow Jones Newswires

April 11, 2019 12:14 ET (16:14 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.
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