Forget the banking numbers, it’s confidence that is crucial

Barclays was today retaining a studied silence over the unnamed forces that have decided to re-publicise the fact that any nationalisation or part-takeover of the bank would trigger a clause handing control to its Arab investors.

So why have these unnamed forces refocused the spotlight on the clause?

Is it to show just how desperate Barclays chief executive John Varley and the Barclays board were to sell shares in the bank to anyone other than Gordon Brown?

Or is it to demonstrate that, whatever Brown is saying, he is not in control of the situation?

The timing of the leaked letter showing the strong cards the Arabs have dealt themselves is crucial. The collapse in Barclays and other banking shares indicates that equity investors are exiting the stock of the High Street banks in their droves.

That could be because they think they are about to be nationalised. It could be because they see no value in companies that are not in charge of their own destinies.

But a lack of confidence in banks, so senior sources in the industry will have it, does not mean a lack of capital. Estimates suggest that, under its most recent recapitalisation, Barclays would have to burn something like £20 billion in the next four months if it were to have to go back to equity investors to raise new money.

If it were to lose such an amount so quickly, the argument goes, there really would be no Barclays Bank or British banking system left. The issue of having to raise equity capital is therefore a red herring.

But the reason the future of Barclays is in the spotlight is that no one believes a word a banker says, and the financial crisis is ultimately not about capital but about confidence.