Barclays deny $400 million losses

30 August 2007

Barclays could have lost as much as $400 million in the sub-prime lending market through funds linked to German bank Sachsen it emerged yesterday.

The company's share price dropped three per cent prompting city analysts to insist on a statement from Bob Diamond, Barclays Capital chief executive.

Barclays rejected claims that they could have amassed $400 million of losses through investing in SIV-lite funding vehicles made for Sachsen.

Speaking to City AM a Barclays spokesman said the bank had "provided no funding at any time to the Sachsen SIV-lite".

But due to the fallen share price, analysts claim that a formal clarification from the chief executive is needed.

Speaking to the newspaper, David Buik from Cantor Index, said: "Surely there cannot be a better or more respected spokesman for a financial institution than Bob Diamond. So when it came to a repudiation or denial as to the level of involvement Barclays Capital has had with Sachsen, the last person they wanted to hear from is a spokesperson!"

A source close to Barclays told the newspaper that the issues would not be a problem in normal markets.

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