Barclays' £7 billion bailout, mainly from Middle Eastern investors, looked increasingly likely to go ahead today even as the bank's existing shareholders vented their frustration at the terms of the deal.

Marcus Agius, chairman, and John Varley, chief executive, today met the Association of British Insurers (ABI) which represents institutions who own around a fifth of the stock market.

The ABI has issued its members with a so-called "Amber Top" notice about next Friday's meeting to approve the bailout. Such a notice advises institutions that the ABI has concerns about the deal but not enough to recommend voting against the motions.

The lobby group said: "The cost of the proposed funding is very substantial and is, in the opinion of some shareholders, unfavourable compared to the terms offered to other UK banks from HM Treasury."

It also said that there were concerns over the Middle Eastern investors having a level of control through owning 30% of Barclays equity without paying any premium.

The ABI said it could still alter its amber warning after today's meeting.

But City analyst Jon Kirk, of brokers Redburn Partners, today told his clients that he believes that Barclays bank is right to be paying more to avoid being part-nationalised.

He totally disagreed with Sir Philip Hampton and John Kingman, who are chairman and chief executive of UKFI Ltd which will hold the Government's stakes in Royal Bank of Scotland and Lloyds Banking Group.

They argued in today's Financial Times that they were there to manage the taxpayer's investments, not the banks themselves. They also stated that the banks are "not being asked to operate uncommercially".

Kirk does not believe this will turn out to be the case. He says that on the most cynical level it was an attempt to raise the banks' share prices and reduce the Government's already embarrassing paper loss of £5 billion.

He said "the door is left open for meddling" and "the deeper the recession, the greater the temptation will be for politicians to get involved, particularly with a General Election due by the first-half of 2010 if not before."

Barclays made it clear that it does not believe the deal with the Qatari and Abu Dhabi investors can be renegotiated. A source close to the deal said: "The Arabs shook hands on a deal and they see no reason why it should change."

Barclays would have to pay a £300 million break-fee if the £7bn bail-out deal is scrapped.