With £1.635bn in writedowns, Barclays revealed that it
had fared better than its rivals during the credit turmoil but questions remain
over the bank’s accounting approach to recognising the losses.
But the bank insists its accounting is prudent – arguing that is figures were
audited by the same PwC team that took a tough stance with the
AIG insurance group, forcing them to adjust their
Barclays’ losses were inclusive of a £658m gain on the carrying value of the
bank’s own debt – indicating that the bank’s own lending is less onerous as well
as the debts owed to it.
Analysts have also raised questions over Barclays’ approach to valuing
£7.37bn worth of loans to private equity groups, sitting on the balance sheet.
The bank has written off £130m in fees and taken a £58m hit to its portfolio,
even though several leveraged loans are moving between buyers at less than 90%
of their original value, the FT reported.
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