Investor activist Ed Bramson has suffered a sharp defeat in his battle to win a seat on the Barclays board.
The shareholders’ votes were 87.2 percent against his election since the US investor could only accumulate 12.8 percent of the votes. Apart from its own 5.5 percent stake, and considering the stake, Bramson could only persuade less than four percent of the other shareholders of the bank to support his case.
The elusive Bramson, who predicted a major defeat, attended the General Board this morning but left within minutes of the start of the meeting.
Bramson, whose Sherborne Investors investment vehicle holds a 5.5 percent stake, has repeatedly called for a reduction in Barclays’ investment banking division. Frustrated that their concerns were being ignored, the US-based investor called a vote to elect him for the council.
Barclays has accepted that its investment bank is not performing “at the level it should”, but has vigorously tried to reject Bramson’s efforts to make its way onto the board. Despite the loss of Bramson, disgruntled shareholders relieved their frustration with the board over the bank’s share price, which fell 20 percent in the last year.
The regular and critical assistant of Barclays, Michael Mason-Mahon, said: “I have to say it and I do not want to do it, but I support that Mr. Bramson is part of this board of directors, could awaken this board of directors”.
Another shareholder urged investors to vote against Branson’s election, but gave the board a “kick in the back”. Another said that despite the bank’s poor performance, Bramson “was not the answer.”
The bank’s first-quarter results did not give either side the advantage last week before today’s meeting.
The investment bank of Barclays saw its profit before taxes drop by 29 percent and yields, with which Bramson had a special problem, fell to 9.5 percent from 13.2 percent the previous year.
But the division outperformed all its rivals in the United States minus one and won market share for the sixth consecutive quarter.
A war of words has broken out between the two in the run-up to today’s clash when both sides fought for the votes of the shareholders.
Barclays warned that Bramson’s presence on the board would be “destabilizing” and “destructive.” The outgoing chairman, John McFarlane, also said that Bramson’s interests were “misaligned” with other shareholders since his share was covered by limited derivatives over time that limited his exposure to a fall in the price of the shares.
The bank’s exhaustive 1,500-word recall prompted Bramson to break its month-long silence in an attempt to attract shareholders.
Responding after the bank announced a series of leadership changes at its investment bank, Bramson said his “experience and temperament” would be a “strongly stabilizing” influence on the board.
He attacked the current strategy of Chief Executive Jes Staley to allocate more resources to the division, which he described as “unsustainable in the long term.”
He said that the board’s strategy had not yet generated a positive return for shareholders and that following it would pose a “real threat” that new capital would be needed.
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