Barclays’ former chief executive has defended a 2008 Qatari investment as key to the bank’s global ambitions but distanced himself from negotiations that led to a complex agreement that is at the heart of a criminal trial.
A jury at Southwark crown court was read statements from three of the four defendants facing charges, including the former chief executive, John Varley. The statements were originally issued to Serious Fraud Office investigators in 2014.
The court heard that Varley, who served as chief executive until 2010, had “global ambitions for Barclays” that meant expanding foreign ownership and increasing the bank’s non-UK income to 75% of the total.
After striking a relationship with the China Development Bank in 2007, Varley said he “was interested in developing a similar relationship with the Qataris, building on that example of how to develop a valuable collaboration”.
Varley acknowledged that the Qataris had a “reputation of being tough negotiators”. But he believed that the value of the ensuing services agreement, which resulted in millions being paid to the Gulf state, “over time would far exceed the fees payable”.
He added that Qatar’s subsequent investment in Barclays and the advisory services agreement were “distinct”. “I did not regard the fees payable as connected to the capital raising from a regulatory perspective,” the statement read.
The Serious Fraud Office alleges that four former Barclays executives – Richard Boath, Varley, Roger Jenkins and Tom Kalaris – lied to the stock market and other investors about how £322m in fees were paid to Qatar in relation to emergency fundraising of more than £11bn in 2008.
Prosecutors say the executives put together two advisory services agreements (ASAs) in order to disguise Qatar’s demand for larger commission payments.
All four men have denied the charges.
Varley said he was not involved in day-to-day negotiations with the bank’s Qatari investors. “I was kept informed of the development on the capital raising during that period and I was aware that the deal team led by Roger Jenkins was having tough negotiations with the Qataris.”
He added that “no legal obstacles” were flagged up to him, particularly in October 2008, when he understood “there had been robust negotiations by Roger and his team”.
Only two witnesses have given live evidence during the landmark trial, and Judge Mr Justice Jay confirmed on Thursday that the prosecution would not call further witnesses.
The trial continues.
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