Archives For Banks

Barclays Bank is implicated in the use of cluster munitions in Misrata. Analysis of the accounts of Instalaza, the manufacturer of the cluster munitions used in Misrata, by Profundo shows that Barclays Bank has been a major funder of the Spanish arms manufacturer.

In 2007, Instalaza generated annual revenues of € 14.9 million, resulting in a net profit of €0.2 million. On 31 December 2007, Instalaza owned total assets of € 31.8 million. These assets were financed by the following financial stakeholders:

Shareholders: € 17.1 million 53.8%
Banks: € 12.0 million 37.7%
Other: € 2.7 million 8.5%

The banks involved included:.

Deutsche Bank (Germany): €3,068,951
Cajalón, part of Grupo Caja Rural (Spain): €2,692,750
Caja España (Spain): €2,153,297
Caja Mediterráneo (Spain): €1,602,438
Bankinter (Spain): €852,310
Barclays Bank (United Kingdom): €593,978
Ibercaja (Spain): €498,993
Banco Popular (Spain): €299,308
Banco Sabadell (Spain): €87,906
La Caixa (Spain): €33,000
Others €117,856
Total €12,000,787
Source: Instalaza SA, “Depósitos De Cuentas: 2007”, Instalaza SA, 2008.

Some of the bank loans have been repaid since 2007 but the following banks still had loans outstanding on 31 December 2009:

Bankinter
Barclays Bank
Banco Popular
Cajalón
Caja España
Deutsche Bank

Media reports suggest the cluster munitions were fired by Libyan forces. In fact, neither Qatar nor the USA have signed to sign up to the CLuster Munitions Convention.

Under the terms of the Cluster Munitions (Prohibitions) Act 2010, it is a criminal offence to encourage or assist in the development, production or acquisition of cluster munitions. According to the UK government this includes “the direct financing of cluster munitions.” (Chris Bryant, Houses of Parliament, Hansard 7 December 2009

Terms of the Act include:

(1)It is an offence for a person to—.
(a)use a prohibited munition,.
(b)develop or produce a prohibited munition,.
(c)acquire a prohibited munition,.
(d)make arrangements under which another person acquires a prohibited munition,.
(e)have a prohibited munition in the person’s possession,.
(f)transfer a prohibited munition, or.
(g)make arrangements under which another person transfers a prohibited munition..
(2)It is an offence for a person to assist, encourage or induce any other person to engage in any conduct mentioned in paragraphs (a) to (g) of subsection (1)..
(3)A person guilty of an offence under this section is liable, on conviction on indictment, to imprisonment for a term not exceeding 14 years or to a fine, or to both..

Updated 10 June

Banking institutions have been implicated in the use of cluster munitions in Misrata. Deutsche Bank granted Spanish company Instalaza, the cluster bomb manufacturer, a loan of about €3.1 million according to information from non-governmental organisation Urgewald, as reported in the weekly Die Zeit on Wednesday.

More than 100 countries signed the Convention on Cluster Munitions at the end of 2008 – it became binding international law for those who signed at the start of August 2010. The convention bans not only the use but also the support of manufacture of cluster munitions.

A spokesman for Deutsche Bank told Die Zeit he could not comment on specific customer relationships, but denied the bank financed the sale of the controversial munitions.

“Deutsche Bank does no business directly connected to certain types of weapons like personnel landmines, cluster bombs or ABC weapons,” he said.

The paper said the Deutsche Bank loan was made in 2007 and reported that other German companies have continued to invest in cluster bomb manufacturers since then. More than a dozen insurers offer Germans taking part in the Riester-Funds pension scheme the option of putting their money in funds which have invested in cluster bomb makers.

These include Deutscher Ring, Basler, Condor, Stuttgarter, Volkswohlbund and WWK. The paper noted that because the Riester-Funds contracts are co-funded by the German government, it should be assumed that public money is also finding its way into the coffers of cluster bomb manufacturers.

The question of who actually fired the cluster munitions into Misrata remains open, with none of Qatar, Libya and the USA having signed up to the Convention.