Bought @ 489.25p

Bought at 489.25p because, at this price, even the historic yield is over 6%.

The price is so low because of uncertainty about the amount that Barclays will have to write off for its exposure to the sub prime market fall out. However, I think the market's fears are excessive because:

1. Barclays continues to buy back its own shares
2. The directors have bought heavily recently
3. Barclays has not issued a profits warning.

Barclays has survived several major crises in its history and it is likely to survive this crisis, even if it is one. Moody's and S&P continue to give it AA1 and AA ratings respectively and both consider the outlook as stable. John Varley and Bob Diamond have indicated even very recently that Barclays continues to trade profitably.

The yield is higher than that which can be obtained from most banks and building societies. With market and customer confidence and top jobs at risk, I do not think that Barclays will cut the dividend. If there is a requirement for large provisions, this will probably be spread over a number of years - Barclays will have this leeway by marking to model rather than market.Even if the dividend is only maintained for the next couple of years, it will probably resume growth after that.