Barclays Is Latest to Cut Finance Ties With Private Prisons
Barclays Is Latest to Cut Finance Ties With Private Prisons
(Bloomberg) -- Barclays Plc will stop providing future financing to companies that manage private prisons and immigration holding facilities, joining other major lenders in shunning the industry.
“We have an existing credit commitment, which does not represent a material portion of our business,” the London-based bank said in a statement Wednesday. “We intend to allow this facility to expire in due course and currently do not plan to enter any new financing agreements with these companies.”
Barclays’s relationship with Geo Group Inc., one of the biggest for-profit prison companies, dates back to 2001. Barclays was a lender on Geo Group’s $900 million facility, which expires in May 2024, according to data compiled by Bloomberg.
Geo Group and CoreCivic Inc., the two biggest for-profit prison companies, have called the banks’ moves politically motivated.
“It’s unfortunate that misleading political activism has been allowed to impact decade-long banking relationships,” a spokesman for Geo Group said in an emailed statement. “The divestment efforts against our company are based on a false narrative and a deliberate mischaracterization of our role as a longstanding government services provider.”
The decision mirrors similar moves from Bank of America Corp., JPMorgan Chase & Co., Wells Fargo & Co. and SunTrust Banks Inc.
Barclays could also be moving ahead of a bill from Brian Benjamin, a New York State senator, which aims to prohibit banks chartered in the state from financing private prisons. Although Barclays is based in London, it uses a New York charter to operate in the U.S.
Benjamin’s bill passed the state Senate earlier this summer, and will need to pass that chamber again in 2020 before going to the Assembly and the governor for approval.
To contact the reporter on this story: Elizabeth Rembert in New York at erembert@bloomberg.net
To contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, Steve Dickson, Dan Reichl
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