By Kirstin Ridley and Steve Slater
LONDON, July 30 (Reuters) - Barclays said onTuesday it was contesting the preliminary findings of a Britishregulatory probe into its commercial agreements with Qatariinvestors who led a rescue fundraising of the bank during the2008 financial crisis.
Neither Barclays nor the Financial Conduct Authority (FCA)disclosed what the preliminary findings were. But the bank saidit received them on June 27 and contested them five days ago.
The FCA and Britain's Serious Fraud Office (SFO) have beeninvestigating for about a year the circumstances surrounding theQatari cash injection secured by Barclays, which is strugglingto restore its reputation after a string of scandals.
Qatar Holding invested 5.3 billion pounds ($8 billion) inBarclays in June and October 2008, helping it avoid a governmentbailout and associated stringent re-payment terms and conditionsimposed on bailed-out rivals Lloyds Banking Group andRoyal Bank of Scotland.
"Barclays expects further developments in the near term," itsaid of the probe, as it announced a 5.8 billion pound rightsissue to plug a capital reserve shortfall.
"Barclays is co-operating with all the authorities fully. Itis not possible to estimate the financial impact upon Barclaysshould any adverse findings be made," it added.
It is unusual for details of regulatory investigations to bemade public before any formal warning notice is issued.
But Barclays has been at pains to be fully transparent sincebecoming the first bank fined for its part in a global scam tomanipulate Libor benchmark interest rates last year, whichprompted a political furore so severe that its previous chiefexecutive Bob Diamond and chairman Marcus Agius resigned.
ALL EYES ON BARCLAYS
Barclays has said the Financial Services Authority (FSA),the FCA's predecessor which launched the probe, had focused onthe bank and four current and former senior employees, includingfinance director Chris Lucas.
Sources familiar with the investigation have said theregulator is also investigating Roger Jenkins, the mainarchitect of the Qatar fundraising, who left Barclays in early2009 and is now at Brazilian investment bank BTG Pactual.
The U.S. Department of Justice and the Securities andExchange Commission have also waded in, opening an inquiry lastOctober into whether Barclays' third-party relationships, whichhelp it win and retain business, breach anti-bribery rules.
Barclays said on Tuesday the two U.S. authorities were also investigating the commercial agreements with Qatar, while theU.S Federal Reserve is keen to be kept abreast of developments.
The SFO, which launched its own investigation last August,has said it anticipates progress in its own inquiry by year-end.
The deal with Qatar raised hackles from the outset.Shareholders were angry that Qatar Holding, which is now thebank's biggest shareholder with a 6.7 percent stake, was offeredmore attractive terms than existing investors.
Separately, Barclays said it would vigorously defend itselfagainst fines worth around $470 million by the U.S. FederalEnergy Regulatory Commission (FERC), which alleges the bankmanipulated electricity markets in and around California fromNovember 2006 to December 2008.
Barclays (BARC)
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