By staff reporters Zhang Yuzhe and Cao Zhen

Boldly ignoring the State Council’s rejection, China Development Bank (CDB) invested an additional 136 billion pounds into Barclays to maintain a 3.1 percent stake. The move also shed light on the problematic decision-making process behind the “going-out” campaign of China’s financial giants.

In mid July, CDB’s plan to invest in Barclays was turned down by the State Council, who feared that the current credit crunch hasn’t bottomed out yet. But on July 25, Alistair Smith of Barclays’ investor relations department confirmed to Caijing that CBD had completed the deal, preventing any possible dilution of its stake in the British bank owing to the issuance of new stock.

Initially in May, the policy bank floated a plan to dedicate 500 million pounds for the purchase of new Barclays shares, sources close to CDB management told Caijing. When June came, Barclays announced a decision to issue 1.6 billion new shares in an effort to raise 4.5 billion pounds in cash. However, when CDB’s investment proposal walked the line in front of five regulatory bodies, it received mainly negative evaluation. In the end, the State Council noted that, “the management of state-owned financial institutions is problematic and needs coordination.”