Barclays to fall out of elite European index

A DEVASTATING year for UK bank shares is set to send Barclays tumbling out of a top European index.

Since January, Brexit fears have wiped around £50 billion off the value of the ‘big four’ British banks – Barclays, HSBC, Lloyds and RBS.

Barclays shares have slumped 24 per cent from a high of £2.17 in January to £1.63, wiping £9.2 billion off its market value.

That has made it the smallest constituent of the Stoxx 50 Europe, an index ranking Europe’s largest 50 listed companies.

In a reshuffle on Monday, it is expected to be relegated and replaced by German chemicals giant Linde. Passive funds following the index would have to sell out of Barclays’ shares as a result.

Lloyds, down 21 per cent to 55.4p from their peak of 72.1p in January, and HSBC – down 14 per cent to £6.64 from a January peak of £7.69 – will remain in the index.

RBS shares have fallen 28 per cent to £2.16 from a January peak of £3.02. Banks have been sold by investors despite talking about returning money to shareholders through dividends and share buybacks.

Analysts have pointed to fears of a ‘no-deal’ Brexit and a Left-wing Labour government.

But the UK’s largest lenders all survived the Bank of England’s annual stress test last week.