Barclays sees off Edward Bramson as rebel investor concedes defeat

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Matt Greenslade

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Edward Bramson wants a seat on the board of Barclays

A rebel investor has conceded that he has lost in his attempt to join the board of Barclays after a majority of shareholders voted against the plan.

Edward Bramson said he knew top shareholders had voted against him becoming a director at the bank’s annual general meeting (AGM).

Mr Bramson, who is famed for shaking up companies, wants Barclays to scale back its investment bank to boost returns.

But Barclays has said it is already making efforts to improve performance.

Earlier, the activist investor told the BBC he wasn’t “going anywhere”.

He added that there was “an option” to keep Barclays’ investment bank, but only if it could become a worthwhile asset for investors.

Mr Bramson’s firm, Sherborne Investors Management, has amassed a 5.5% stake in the bank – making it Barclays’ third largest shareholder, but short of having control.

Mr Bramson argues that Barclays’ investment bank – which helps firm sell shares and advises on takeovers – is not profitable enough and that management should focus on the lender’s retail bank.

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Barclays chief executive Jes Staley says that Barclays’ performance is improving

Before the AGM, major shareholders expressed sympathy with his position but declined to back him.

David Cumming, chief investment officer for equities at Aviva Investors, said that while Mr Bramson was good at critiquing the lender he had not “offered a credible alternative strategy”.

Earnings at Barclays’ investment bank rebounded last year, rising 15%, although group profit was flat. Shares in the bank have also fallen by a fifth in the past 12 months.

‘Fear of the unknown’

Addressing shareholders, Barclays’ departing chairman John McFarlane said Barclays’ board had unanimously rejected Mr Bramson’s resolution, agreeing it would “destabilise” the bank.

“We’ve had a full 12 months of clean and respectable profits, producing earnings per share of 20 pence,” Mr McFarlane said.

“When I joined, we were loss-making and dividends were paid from reserves. We’ve firmly drawn a line on the past.”

Barclays boss Jes Staley has also said it would be a mistake for Barclays, the UK’s last home-grown investment bank, to desert global capital markets.

However, Mr Bramson is likely to show persistence.

Since 2003, he has pursued 10 activist campaigns, six of which saw a member of Sherborne Investors joining those boards.

When he joined the board of private equity firm Electra in 2015, it was his second attempt.

At the time he told the Daily Telegraph in a rare interview: “Even if we don’t win the vote, we’re not going away. I’ve told the board: I think we’re OK. They think we’re scum, which is fine. It’s fear of the unknown.”