Barclays (BCS) turned down cash from the UK government. Unlike most large US banks, it did not want to trade independence for money. Companies such as Goldman Sachs (GS), JP Morgan (JPM), and Citigroup (C) will now have the Treasury looking through their underwear drawers for excessive executive compensation, accounting practices, and ski trips.

Barclays did the sensible thing. It went out and raised money on its own. According to MarketWatch, the bank "struck a deal to raise up to 7.3 billion pounds ($11.9 billion) in fresh capital as the U.K. lender signaled its preference for cash from Middle Eastern royal families to the British government."

The excuse that US financial firms might give for not going the private capital route is that Barclays is doing better than they are. But, last November, the UK bank wrote down $2.7 billion in subprime paper. Last May it lost nearly $3 billion.

The stock market is usually not a bad test of how companies in the same industry are doing relative to one another. So far this year, Barclays shares are down 65%, which is more that those of JP Morgan (JPM), Citigroup (C), or Bank of America (BAC).

Barclays took a risk, perhaps a large one, by insisting upon raising private capital. That revives the question of what would have happened if the Treasury and Congress had not stepped in to provide tens of billion of dollars to US banks. Wells Fargo (WFC) did not ask for public capital for its purchase of Wachovia (WB). That is a useful bit of data.

The Barclays announcement indicates that the American banking system may have made it on its own. Some institutions would have been bought by others, probably at fire sales prices. That has already happened to companies like NCC (NCC). But, the valuations of the firms when they traded near their lows were probably attractive enough to bring in private equity and sovereign fund capital.

The bailout may not have been needed at all.

Douglas A. McIntyre

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