Barclays capital push

Barclays said it would raise the equivalent of £5.8 billion (about $9.8 billion) in a rights offering to bolster capital after booking its biggest charge to date for customer compensation. The bank also plans to shrink assets by as much as £80 billion to around £1.5 trillion and sell roughly £2 billion of loss-absorbing securities to meet calls from the British regulator to reduce leverage.

According to the article, Barclays faced a large compensation charge and a capital shortfall that swelled to £12.8 billion at the end of June under the stricter Basel III bank-capital rules. Those pressures, plus British regulator calls to reduce leverage, prompted the rights offering, asset reductions and planned sale of loss-absorbing securities.

The article reports that Barclays chief executive Antony Jenkins is selling more shares than analysts had anticipated. Analysts had expected around £4 billion of share sales, but Jenkins is selling a larger amount following the bank's increased capital shortfall and related restructuring moves.

Construction giant Leighton’s Asian division secured a $2.8 billion contract to build a new luxury casino resort and hotel in Macau. The 450,000 square metre project will be built on the Cotai Strip after Leighton sealed the deal with Wynn Resorts, which operates casinos in Las Vegas and Macau.

The article states construction on the Macau resort is due to be completed in early 2016. Leighton’s chief executive, Hamish Tyrwhitt, said the project is part of a broader plan to expand the company’s presence in Asia.

The article notes that Japanese factories delivered an unexpectedly weak performance in June and household spending slipped. Those weak indicators underscore the challenge Prime Minister Shinzo Abe faces in kick-starting Japan’s economy and are relevant for investors watching growth and consumer demand in the world’s third-largest economy.

The article describes Abenomics as Prime Minister Shinzo Abe’s growth-boosting program that involves large government spending and central bank monetary easing. It also notes that the Bank of Japan aims to hit a 2 percent inflation target as part of efforts to reverse years of falling prices.

The article highlights three investor-relevant points: Barclays is raising capital and shrinking assets to address compensation charges and regulatory capital shortfalls; Leighton won a major $2.8 billion Macau contract with Wynn Resorts as part of its Asia expansion; and weak Japanese factory output and household spending underline challenges for Abenomics and the Bank of Japan’s push toward a 2 percent inflation target.