Barclays will on Tuesday launch a rights issue to raise more than £5 billion as the UK bank moves fast to come into line with British regulatory requirements on leverage, according to two people briefed on the transaction.
Antony Jenkins, who took over as Barclays' chief executive a year ago, will also unveil details to shrink the bank's balance sheet.
The moves, which echo initiatives at Deutsche Bank in recent months, will leave Barclays with a core tier one capital ratio of around 9.5 per cent under "fully-loaded" incoming Basel III rules, according to one person briefed on the plan. That ratio – which measures equity as a proportion of risk-weighted assets – brings Barclays back into line with global rivals, after a period of underperformance.
Barclays was spurred into the capital and balance sheet measures when the UK's Prudential Regulation Authority last month said it had a leverage ratio of only 2.5 per cent, after factoring in expected losses and other costs, compared with a requirement of 3 per cent.