Qatar Investment Authority slashes Barclays stake

Shares of Barclays fell on Tuesday after the Qatari sovereign wealth fund began selling almost half its stake in the banking giant.

Qatar Holding, a subsidiary of the Qatar Investment Authority, plans to sell around £510 million of Barclays shares, reducing its stake in the company from 5.3 percent to 2.9 percent, according to Reuters news agency.

Barclays shares fell 4.5 percent on Tuesday morning, before recovering in the late afternoon to settle 2.4 percent lower at 139.5p. Shares are down about 15 percent since the start of the year.

QIA is Barclays' second-largest shareholder, although it reduced its stake in the British lender by 5 percent in 2021 and 10 percent last year.

It first invested in Barclays during the global financial crisis in 2008, when the lender launched emergency appeals to shore up its balance sheet.

Barclays avoided a bailout from the British government after raising £4 billion from Qatar and billions more from other Middle Eastern investors.

The fundraising became the subject of a Serious Fraud Office investigation into whether the bank had passed on undisclosed fees to Qatari investors in return for the financing.

Three former Barclays executives were cleared of fraud in 2020 after a seven-year investigation into the allegations and a trial that cost £12.2 million of taxpayers' money.

However, Barclays was fined £50 million by the Financial Conduct Authority last year and branded 'reckless and lacking integrity' for failing to disclose 'advisory fees' paid to Qatar.

Since then, the company has struggled with falling investment banking costs, as there is less interest in doing mergers and acquisitions, and as margins in the British high street division are under pressure.

Barclays reported that profits in the three months ended September fell 16 percent to £1.3 billion, while many other major British and American banks achieved stellar results.

The FTSE 100 group warned that the full-year net interest margin – the difference between what banks earn on loans and the amount they pay to savers – at the UK retail bank would be lower than expected, at between 3.05 and 3.05. 1 percent.

Its CEO, CS Venkatakrishnan – commonly known as Venkat – also told reporters that the bank was looking for “efficiencies” to help reduce “structural costs”.

Reuters reported late last month that Barclays was planning to cut up to 2,000 jobs as part of £1 billion of cost-cutting measures, with jobs in its legal, compliance and human resources departments likely to be hardest hit.

Barclays also plans to divest its German consumer finance unit and is considering divesting a partial stake in its UK payments business.