ABI tightens the screw

Wow, I'm a bit surprised by this (from Citywire):

Changes to Barclays' cash raising plans win few supporters

By Deborah Hyde | 14:30:21 | 18 November 2008

Institutional investors have expressed ‘grave concerns’ about Barclays’ capital raising measures, with the new measures taken by the bank appearing to have done little to appease those who oppose the deal.

Despite the bank’s decision to allow institutions to participate in some of its capital raising measures and for its directors to forgo their bonuses, both analysts and shareholders remain unconvinced of the merit of the deal, with one analyst describing Barclays’ latest measures as a ‘small olive branch’.

The ABI, which represents leading opponents Legal & General and Aviva as well as other insurance groups, has slapped a ‘red top’ on the bank.

The group said that the red top, a designation which the organisation rarely dishes out, does not constitute advice to vote against the proposals, but highlights the presence of an issue of grave concern.

It said it had made the decision because the changes announced today did not address all of its concerns.

'These changes cannot offset the concern of shareholders at the serious breach of the pre-emption principle, especially on an issue with a large discount,' said Peter Montagnon, the ABI’s director of investment affairs

The ABI met with Barclay’s management last week to discuss their opposition to the plans to raise £7 billion fin the Middle East.