Oct. 13 (Bloomberg) -- Barclays Plc, the U.K.'s second-biggest bank, plans to sell more than 6.5 billion pounds ($11 billion) of shares to private investors without turning to the government for help, and said it won't pay a final dividend for 2008.

``The board expects that the additional capital will be raised from investors without calling on the government funding which has been offered to U.K. banks,'' the London-based bank said in a statement today.

Barclays has decided to raise money on its own while rivals Royal Bank of Scotland Group Plc, HBOS Plc, and Lloyds TSB Group will get 37 billion pounds from the British government as authorities across Europe act to avert a banking collapse. The worsening credit crisis has forced the U.K to join the U.S., Ireland, Iceland, Belgium and Spain in rushing out untested bailout measures to save their largest banks.

``It's too early to tell if the tide has been turned,'' Barclays Chief Executive Officer John Varley said in a call with journalists today. ``The extraordinary conditions in the industry shouldn't be underestimated,'' Varley, 52, said.

Barclays will issue preference shares to raise 3 billion pounds by Dec. 31, and will sell ordinary stock to raise about 600 million pounds to fund the purchase of some of Lehman Brothers Holdings Inc.'s assets. The bank will also issue new ordinary shares to raise a further 3 billion pounds by March 31, 2009.

``This is an overkill for Barclays,'' said Mamoun Tazi, a London-based analyst at MF Global Securities who has a ``buy'' rating on the shares. The company ``wants to do it on its own.''

The bank will raise more than 10 billion pounds in all, with 3.5 billion pounds from dividend and other initiatives. Barclays said it has an agreement ``in principle'' with an existing shareholder to contribute 1 billion pounds in new capital.

Shares Climb

Barclays added 3.7 percent to 215.25 pence in London, giving the company a market value of 18 billion pounds, and trimming the decline this year to 56 percent.

Banks' losses and writedowns of more than $635.2 billion since the global credit crisis began about 13 months ago have sent stock markets plunging. The contraction in credit markets that's led to the failure of New York-based Lehman and Washington Mutual Inc. is raising concern among investors that the world's biggest economies may go into a recession.

Barclays said pretax profit in September ``very significantly exceeded the monthly run rate'' for the first half the year fueled by contributions from its global retail and investment-banking units. Barclays can still tap the government facilities made available to U.K. banks, the company added. The bank said it doesn't expect ``significant writedowns'' and plans to pay an interim dividend in the third quarter of 2009.

Royal Bank of Scotland, the second-biggest U.K. bank before shares collapsed last week, ousted its chief executive officer and turned over control to the government in exchange for a 20 billion-pound lifeline.

HSBC Holdings Plc, Britain's biggest bank, said last week it has sufficient resources and won't participate in the government recapitalization plan.

To contact the reporters on this story: Ambereen Choudhury in London at achoudhury@bloomberg.net.

Last Updated: October 13, 2008 11:41 EDT