Jun 8, 2020

Barclays ‘misled’ the market over Qatar deal, court told

Barclays "Deliberately misled" the market over the terms of its emergency capital raising from Qatar at the height of the 2008 financial crisis and "Concealed" a $3bn loan to the Gulf state, it was claimed at London's High Court at the start of a high-profile trial. Ms Staveley's PCP led a parallel investment in Barclays by Abu Dhabi in October 2008 but the group claims it would not have put money in if it had known Qatar had been offered a different deal. Opening PCP's case at the High Court of England and Wales on Monday, Joe Smouha QC said the "Almost desperate need" for fresh capital by Barclays in October 2008 meant Qatar could "Exploit Barclays' weak bargaining position" and demand "Extensive fees" with the result that the state's deal was "Very substantially better" than that struck with PCP. In his written arguments for the trial, Mr Smouha claimed Ms Staveley said she was told by Roger Jenkins, the former chairman of investment banking for Barclays in the Middle East, that the Qataris were getting the "Same deal" as Abu Dhabi. In its written openings, Mr Smouha claimed Barclays' loan department "Was incredulous" in 2008 about the bank advancing a $3bn unsecured loan to Qatar but staff were told that it "Was required by the highest level of the bank". In its written arguments, Barclays said the Qatar loan was not approved by Barclays' independent credit committees until two weeks after Qatar was legally committed to the October 2008 fundraising and the loan documentation expressly said that the loan could not be used to finance the purchase of the bank's shares.

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