BusinessBusiness RecoveryBarclays in talks with Treasury about Asset Protection Scheme

Barclays in talks with Treasury about Asset Protection Scheme

Banking heavyweight confirms that it is in discussions with the Treasury about a possible ring-fencing of its assets

Barclays is in talks with the Treasury about joining the Asset Protection
Scheme, the programme rolled out to restore confidence in the UK’s biggest banks
by providing protection against future losses on their riskiest assets.

Under the terms of
the
scheme
, banks receive protection for a proportion of their balance sheets so
that the healthier core of their commercial business can continue to lend to
creditworthy businesses and households.

In a statement to the city, Barclays said it was ‘in dialogue with HM
Treasury and the FSA regarding its potential participation in the government’s
Asset Protection Scheme.’

‘Barclays decision whether – and to what extent – to participate in the
scheme will be based on the economic merits to shareholders of any such
participation.’

In return for the protection, banks must pay a fee and enter into legally
binding agreements to increase the amount of lending they provide to homeowners
and businesses.

Last month RBS hammered out an agreement in principle with the Treasury which
said it would pay £6.5bn to have £325bn of assets of its assets protected.

Further reading:

HM Treasury notice on
the Asset Protection Scheme

Lloyds
Group win huge government tax concession

RBS
poaches Abbey National, A & L CFO

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