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Barclays to raise cash from insurance assets

Date: Mon, 13 Oct 03 Analysis

Barclays has announced plans to raise funds from debt secured against the assets of its life insurance business.

The bank is expecting to generate some £400 million in this way, intended to help fund organic growth and improvements in capital structure.

Barclays currently has an estimated 1.4 million life insurance policyholders on its books. Bosses have asserted they will be unaffected by the new move.

'We're in the early stages of raising the finance,' Barclays spokesman Andrew McDougall told Reuters.

Barclays will be securing debt against its Barclays Life and Woolwich Life operations, merged in 2000 when the bank bought Woolwich building society.

The move, which aimed to make cost savings of £70m a year over two years, was part of a move to distribute regulated products rather than produce them.

Barclays' new decision follows the recent restructuring of its board with the appointment of John Varley as chief executive, succeeding Matthew Barrett between now and 2005.

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