Barclays said it expects to take a £450 million ($588.8m) hit on mishandled structured product sales causing the British bank to delay its share buyback.
The lender said it issued $15.2 billion more structured and exchange-traded notes than it had registered for sale in the US over a period of about a year, heavily overshooting its $20.8bn limit.
The securities must now be bought back at their original purchase price, the bank said. The trading error was under investigation, it said.
Barclays Bank, the subsidiary that holds the lender’s corporate and investment bank, found that “securities offered and sold under its US shelf registration statement during a period of approximately one year exceeded the registered amount”, a statement by the lender said.
"Barclays has commissioned an independent review of the facts and circumstances relating to this matter including, among other things, the control environment related to such issuances," it said.
"Separately, regulatory authorities are conducting inquiries and making requests for information."
The mishandled products were two exchange-traded notes linked to crude oil and market volatility, sources said, with the bank suspending sales and issuance of the notes this month.
The firm issued about $36bn of investment products after registering with US regulators in August 2019 to sell up to $20.8bn, the bank’s statement said, with the trading error now requiring Barclays to repurchase the affected securities — a so-called rescission offer — at their original price.
The bank said its "best estimate at this time" was that the loss would amount to £450m, cutting its core capital ratio down to the middle of its 13-14 per cent target range, with the loss estimate not including tax.
As a result the bank said it would delay a planned £1bn share buyback, first unveiled on February 23 as part of its full-year 2021 results, until the second quarter of this year, while the independent review was carried out.
Barclays' wider investment bank had previously proved a stellar performer for the group over recent years, helping it post a record annual profit for 2021.
Analysts at Shore Capital said in a note that the bank appeared to be "tripping over its shoelaces", while other analysts called the mistake “basic”, “bizarre” and “embarrassing”.
Major banks typically file for blanket registrations that allow them to regularly issue notes that give clients a chance to bet on everything from market volatility to the performance of shares.
Market observers also said they could not recall a bank’s issuance exceeding the amount it registered, let alone blowing billions past its limit.
Chief executive C S Venkatakrishnan, who took charge of the lender in November, was the group’s chief risk officer at the time the registration document was filed.
“This kind of seemingly basic error may shake confidence in the investment bank going forward,” said Fahed Kunwar, an analyst at Redburn.
“With a new management team in place, there are already questions on the ability of the investment bank to continue to its strong performance.”
Shares in Barclays were down 2.8 per cent at 11.37am London time on Monday.
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Jetour T1 specs
Engine: 2-litre turbocharged
Power: 254hp
Torque: 390Nm
Price: From Dh126,000
Available: Now
The specs: 2018 Chevrolet Trailblazer
Price, base / as tested Dh99,000 / Dh132,000
Engine 3.6L V6
Transmission: Six-speed automatic
Power 275hp @ 6,000rpm
Torque 350Nm @ 3,700rpm
Fuel economy combined 12.2L / 100km
Shooting Ghosts: A U.S. Marine, a Combat Photographer, and Their Journey Back from War by Thomas J. Brennan and Finbarr O’Reilly
Essentials
The flights
Whether you trek after mountain gorillas in Rwanda, Uganda or the Congo, the most convenient international airport is in Rwanda’s capital city, Kigali. There are direct flights from Dubai a couple of days a week with RwandAir. Otherwise, an indirect route is available via Nairobi with Kenya Airways. Flydubai flies to Kinshasa in the Democratic Republic of Congo, via Entebbe in Uganda. Expect to pay from US$350 (Dh1,286) return, including taxes.
The tours
Superb ape-watching tours that take in all three gorilla countries mentioned above are run by Natural World Safaris. In September, the company will be operating a unique Ugandan ape safari guided by well-known primatologist Ben Garrod.
In the Democratic Republic of Congo, local operator Kivu Travel can organise pretty much any kind of safari throughout the Virunga National Park and elsewhere in eastern Congo.
In numbers: China in Dubai
The number of Chinese people living in Dubai: An estimated 200,000
Number of Chinese people in International City: Almost 50,000
Daily visitors to Dragon Mart in 2018/19: 120,000
Daily visitors to Dragon Mart in 2010: 20,000
Percentage increase in visitors in eight years: 500 per cent
SPEC SHEET
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CPU: Unisoc T610; Mali G52 GPU
Memory: 4GB
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Camera: 8MP rear, 5MP front
Connectivity: Wi-Fi, Bluetooth 5.0, USB-C, 3.5mm audio
Battery: 8200mAh, up to 10 hours video
Platform: Android 11
Audio: Stereo speakers, 2 mics
Durability: IP52
Biometrics: Face unlock
Price: Dh849
BMW M5 specs
Engine: 4.4-litre twin-turbo V-8 petrol enging with additional electric motor
Power: 727hp
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Defence review at a glance
• Increase defence spending to 2.5% of GDP by 2027 but given “turbulent times it may be necessary to go faster”
• Prioritise a shift towards working with AI and autonomous systems
• Invest in the resilience of military space systems.
• Number of active reserves should be increased by 20%
• More F-35 fighter jets required in the next decade
• New “hybrid Navy” with AUKUS submarines and autonomous vessels
Cricket World Cup League 2 Fixtures
Saturday March 5, UAE v Oman, ICC Academy (all matches start at 9.30am)
Sunday March 6, Oman v Namibia, ICC Academy
Tuesday March 8, UAE v Namibia, ICC Academy
Wednesday March 9, UAE v Oman, ICC Academy
Friday March 11, Oman v Namibia, Sharjah Cricket Stadium
Saturday March 12, UAE v Namibia, Sharjah Cricket Stadium
UAE squad
Ahmed Raza (captain), Chirag Suri, Muhammad Waseem, CP Rizwan, Vriitya Aravind, Asif Khan, Basil Hameed, Rohan Mustafa, Kashif Daud, Zahoor Khan, Junaid Siddique, Karthik Meiyappan, Akif Raja, Rahul Bhatia
Seven tips from Emirates NBD
1. Never respond to e-mails, calls or messages asking for account, card or internet banking details
2. Never store a card PIN (personal identification number) in your mobile or in your wallet
3. Ensure online shopping websites are secure and verified before providing card details
4. Change passwords periodically as a precautionary measure
5. Never share authentication data such as passwords, card PINs and OTPs (one-time passwords) with third parties
6. Track bank notifications regarding transaction discrepancies
7. Report lost or stolen debit and credit cards immediately
KILLING OF QASSEM SULEIMANI
PROFILE OF INVYGO
Started: 2018
Founders: Eslam Hussein and Pulkit Ganjoo
Based: Dubai
Sector: Transport
Size: 9 employees
Investment: $1,275,000
Investors: Class 5 Global, Equitrust, Gulf Islamic Investments, Kairos K50 and William Zeqiri
The specs
Engine: Four electric motors, one at each wheel
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What is the FNC?
The Federal National Council is one of five federal authorities established by the UAE constitution. It held its first session on December 2, 1972, a year to the day after Federation.
It has 40 members, eight of whom are women. The members represent the UAE population through each of the emirates. Abu Dhabi and Dubai have eight members each, Sharjah and Ras al Khaimah six, and Ajman, Fujairah and Umm Al Quwain have four.
They bring Emirati issues to the council for debate and put those concerns to ministers summoned for questioning.
The FNC’s main functions include passing, amending or rejecting federal draft laws, discussing international treaties and agreements, and offering recommendations on general subjects raised during sessions.
Federal draft laws must first pass through the FNC for recommendations when members can amend the laws to suit the needs of citizens. The draft laws are then forwarded to the Cabinet for consideration and approval.
Since 2006, half of the members have been elected by UAE citizens to serve four-year terms and the other half are appointed by the Ruler’s Courts of the seven emirates.
In the 2015 elections, 78 of the 252 candidates were women. Women also represented 48 per cent of all voters and 67 per cent of the voters were under the age of 40.
Killing of Qassem Suleimani
Specs
Engine: Dual-motor all-wheel-drive electric
Range: Up to 610km
Power: 905hp
Torque: 985Nm
Price: From Dh439,000
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MATCH INFO
Uefa Champions League semi-finals, first leg
Liverpool v Roma
When: April 24, 10.45pm kick-off (UAE)
Where: Anfield, Liverpool
Live: BeIN Sports HD
Second leg: May 2, Stadio Olimpico, Rome
HOW TO WATCH
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Twitter: @thenationalnews
Instagram: @thenationalnews.com
TikTok: @thenationalnews
LILO & STITCH
Starring: Sydney Elizebeth Agudong, Maia Kealoha, Chris Sanders
Director: Dean Fleischer Camp
Rating: 4.5/5
Killing of Qassem Suleimani
Astroworld
Travis Scott
Grand Hustle/Epic/Cactus Jack
