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Barclays (BCS) is another massive financial name that Fisher Investments added to its portfolio in the latest quarter. The firm bought close to 15.6 million shares of the U.K. bank, taking on a $236 million position in the firm.
Barclays was the biggest U.K.-based bank to avoid taking government bailout cash when 2008 brought the system to a screeching halt, a feat that management deserves some credit for pulling off (even if it came at the expense of some shareholder equity).
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Like Morgan Stanley, Barclays owns a thriving investment bank, which chips in around half of the firm's total profits. Unlike MS, Barclays unloaded its own asset management unit in late 2009, selling it to
BlackRock(BLK) to create the biggest asset management firm in the world. The fact that Barclays retained 20% of BLK in return is a big benefit for shareholders. BLK has proven more adept than any bank at running its asset management business.
Again, Barclays isn't spotless; the UK economy is under serious pressure right now, threatening the bank's loan book. While a push to bank in emerging markets is a positive for BCS shareholders right now, buyers shouldn't forget about the health of those U.K. loans. The decision to buy the assets of Lehman Brothers at a massive discount should give BCS a big boost once economic engines get roaring again -- as long as it can keep costs like compensation from eating up too much profit. U.K. regulators should help with that.