Comment

No trick or treat for Ed Bramson this Hallowe’en as Barclays campaign unravels

Today’s results show Barclays is doing well despite a once-in-a-lifetime crisis; Bramson should sell his shares and disappear quietly

Ed Bramson and Jes Staley with Barclays logo
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With Hallowe’en all but cancelled this year, how good of Barclays to turn the tables and give the bank’s bogeyman a fright to remember.

Ed Bramson will be white as a sheet as he digests the lender’s latest results: forecast-beating profits during a once-in-a-lifetime crisis; an investment bank firing on all cylinders; and a pledge from boss Jes Staley to hang around for several years yet.

By Bramson’s own measures, his campaign against Barclays has been a complete failure. Still, at least a 7pc jump in the share price will help to recover some of his losses, even if he will still be heavily underwater.

Other than that tiny consolation, Bramson has little, if anything, to show for a hostile, two-year campaign that has catapulted his Sherborne vehicle up the shareholder register and left it vying with the Qatari Investment Authority for the top spot.

It is easy to forget that Bramson also failed spectacularly to gain a seat on the Barclays board last year after less than 13pc of the shareholder base backed the proposal.

Staley has remained steadfastly restrained in the face of Bramson’s aggressive broadsides, but even he couldn’t resist a little dig at his arch-nemesis, going to great pains to highlight the part it is playing in the recovery: 640,000 payment holidays on mortgages, credit cards and loans; £25bn in “Covid-related support” for British enterprise; and £100m of overdraft interest and fees waived.

“Huge support,” concluded Staley, though it’s worth remembering that this is precisely what banks are expected to do, in case the industry was hoping for a pat on the back.

Still, he’s right to point out that such support “is made partly possible” by Barclays’ “diversified business model”, an argument that he has been making all along as Bramson repeated his calls for the investment bank to be ditched: the value of the division is best demonstrated during times of economic uncertainty, alleviating the slowdown in other parts of the bank. A surge in trading volumes pushed revenues up by nearly a third over the quarter.

Yet, the rest of the bank has actually held up pretty well, all things considered. Profit of £1.1bn was much higher than expected; and although there was another £608m set aside to cover bad loans, that was below forecasts and much lower than the £1.6bn of provisions in the previous three months.

No wonder then that Staley is sticking around, confounding Bramson’s call for him to step down over his links to the late convicted paedophile financier Jeffrey Epstein.

On the contrary, the American looks likely to remain in the hot seat for another two years, with the full backing of the board, I am reliably informed, as former JP Morgan colleagues CS Venkatakrishnan and Paul Compton slug it out to succeed him.

There was even the hint of a return to dividend payouts in the not-too-distant future, with the board saying it “recognises the importance of capital returns”, once the Bank of England lifts its suspension.

Still, at least Bramson will be able to relate to the kids as they prepare for a locked down Hallowe’en – there has been no trick, or treat at Sherborne’s headquarters from this jinxed campaign.

One to tell the grandkids

Proof that memories are desperately short in the City. Retirement home builder McCarthy & Stone has been lassoed by a takeover bid from US private equity fund Lone Star.

The board, under the guidance of chairman Paul Lester, has recommended a £1.15-a-share offer, and has been quick to point out that it is a 39pc premium to Thursday’s closing price.

What it is less inclined to alert investors to is that it is markedly lower than a February pre-pandemic level of £1.58, even further off its 2015-float price of 180p, and so far below an all-time high of 277p, investors need a lie down in one of its swanky homes.

But here’s the really juicy historical context missing from proceedings: McCarthy has been through the private equity ringer several times before, including at the hands of HBOS, the Reuben brothers and Scottish tycoon Tom Hunter, and the results were so disastrous it had to be bailed out by lenders. At least there will be plenty of stories for the grandkids.