The firm could now avoid both a new sale of extra stock and entrance into the government's toxic assets insurance scheme.
Barclays has reportedly passed its "stress test" from the Financial Services Authority (FSA) and will therefore likely be able to avoid having to raise fresh capital from shareholders.
The Daily Telegraph reported the result of the investigation this morning, while the Financial Times said that the probe would conclude in the "next few days" but that the FSA has "indicated" that Barclays has passed. Shares in the bank then climbed by 12 percent in early trading, with investors predicting that the news meant a new sale of extra Barclays stock was unlikely.
Under investigation by the regulator is the financial health of the Barclays balance sheet. The stress test began after the bank entered talks with the Treasury on potentially joining its Asset Protection Scheme.
Barclays would agree a deal to have the taxpayer underwrite the "toxic assets" on its balance sheet that have been devalued by the credit crunch, should it enter the scheme before the March 31st deadline. It confirmed earlier this month that it is planning to sell iShares, its fund management unit, which could garner enough money for Barclays to remain independent from government intervention.
The bank has shown an unwillingness to accept bailout money before, striking a £7 billion deal with the Abu Dhabi royal family and other foreign investors last year, rather than enter into the government's £37 billion share-buying bailout plan.
RBS and the Lloyds Banking Group, both participants in this bailout, entered the Asset Protection Scheme earlier this year and have hundreds of billions of pounds worth of assets insured as a result.
