KUALA LUMPUR (Reuters) - The global subprime crisis has yet to run its course, the chairman of British bank Barclays Plc (BARC.L) said on Sunday, amid concerns that big lenders will unveil more credit-related losses in coming weeks.
“The crisis is not near an end. I think it will have a little further to go,” Marcus Agius told reporters on the sidelines of an economic forum in the Malaysian capital.
“But we are beginning to see trades taking place and assets beginning to come to their real value. It will work its way out.”
A meltdown in the U.S. subprime mortgage market which began last year and ensuing turmoil in global credit markets has forced financial firms around the world to take more than $300 billion in write-downs on risky securities linked to housing markets.
Investors fear more losses are to come and are bracing for poor results this week from major Wall Street investment banks Goldman Sachs (GS.N), Lehman Brothers LEH.N and Morgan Stanley (MS.N). Lehman recently forecast a quarterly loss of roughly $2.8 billion and said it had raised $6 billion to shore up its capital.
Barclays reported on May 15 that it had taken a 1 billion pound loss on its assets in the first quarter, less than many other banks but leaving group profits lower than a year ago.
Talk has been circulating for weeks that it could raise billions from a rights issue or by selling shares to sovereign wealth funds.
Barclay’s shares fell to a 10-year low on Thursday amid speculation that it will raise 3 billion pounds, following similar moves by some of its UK rivals such as Royal Bank of Scotland (RBS.L).
Agius declined to comment when asked if he was comfortable with the bank’s capital position.
He also said Barclays was keen to grow its foreign revenue.
“We would like more of our revenue to come from outside of the UK and one of the best places is in Asia,” he said, but did not elaborate.
Reporting by Soo Ai Peng; Writing by Liau Y-Sing; Editing by Kim Coghill