Barclays share price: Bank wins dismissal of US class-action litigation
Barclays (LON:BARC) has won the dismissal of US class-action litigation by investors who bought its stock just months before the 2008 global financial crisis, Reuters has reported. The decision could end eight-and-a-half years of litigation and remove one hurdle for the group’s chief executive Jes Staley as he looks to boost the lender’s profits.
Barclays’ share price has been subdued in London in today’s session, having lost 0.39 percent to 190.80p of 10:42 BST, slightly underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.08 percent higher at 7,385.39 points. The group’s shares have added more than 12 percent to their value over the past year, but have given up some 14 percent over the course of 2017.
Reuters reported this morning that Barclays had won the dismissal or a US class-action lawsuit by investors who bought shares in the bank just months before the 2008 global financial crisis, and accused it of concealing its exposure to risky debt and an inability to manage credit risks. US District Judge Paul Crotty in Manhattan, however, ruled that investors had failed to show that the London-listed lender and underwriters led by Citigroup had deceived them when the British bank sold $2.5 billion of American depositary shares in April 2008.
While the shares had lost 80 percent of their value by the following March, the judge said that much of that decline could have reflected fallout from the collapse of Lehman Brothers the bailout of US insurer American International Group Inc, and government capital injections into other British banks.
“In such circumstances, the prospect that the plaintiff’s loss was caused by the alleged misrepresentations decreases,” Crotty wrote in a 51-page decision, as quoted by Reuters.
The report comes after news emerged this week that Barclays was planning to step up financing in its corporate and investment bank, as part of chief executive Jes Staley’s strategy to improve returns in the business.
As of 11:00 BST, Thursday, 14 September, Barclays share price is 191.35p.