Barclays on course for £7bn deal

Chairman Marcus Agius told investors gathered in London to rubber-stamp the deal, that votes cast ahead of the extraordinary meeting had already given it the required support.

The bank shunned the Government's bail-out cash to welcome Abu Dhabi royalty and Manchester City owner Sheikh Mansour Bin Zayed Al Nahyan as an investor, and gain extra funds from the Qatari Investment Authority and Challenger, which represents Qatar's royal family.

The fundraising has drawn fire as institutional investors were initially excluded from plans to raise £3 billion through the issue of reserve capital instruments (RCIs) to the Middle East trio.

Barclays will pay 14% a year on the RCIs in return for the capital - more expensive than the 12% coupon on the Government's preference shares.

The higher cost and breach of pre-emption rights - the principle that existing investors should be given the first chance to participate in fundraising - angered shareholders.

Mr Agius defended the move on Monday, saying that "in ordinary circumstances" Barclays would have asked for funds in a rights issue - but the turmoil of early October was such that the company needed to act more quickly.

"We felt that a rights issue launched in very difficult market conditions - even if it could have been achieved - would have subjected our shareholders to an excessive period of uncertainty," he added.

Barclays said it shunned taxpayers' cash to retain control of dividends, lending policy and prevent Government interference in the bank's pursuit of high-growth overseas markets.

"The unanimous view of the board was that our shareholders would be better served by the unconstrained path," he said.