Government to sell down 5% more of its NatWest stake

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Government to sell down 5% more of its NatWest stake: Bank moves a step closer to reprivatisation following £45.5bn bailout

Natwest has moved a step closer to reprivatisation after the Government announced plans to sell another 5 per cent of the bank.

UK Government Investments, which manages the Treasury’s stake, said it would sell around 580m shares in the lender to investors this week.

The bank became 84.4 per cent owned by the taxpayer following its £45.5billion bailout during the financial crisis of 2007-09.

Rescue: Natwest bank became 84.4 per cent owned by the taxpayer following its £45.5bn bailout during the financial crisis of 2007-09

Rescue: Natwest bank became 84.4 per cent owned by the taxpayer following its £45.5bn bailout during the financial crisis of 2007-09

The Treasury began reducing its stake in 2015, but was forced to suspend share sales in 2019 and 2020 as Natwest’s performance was hit first by low interest rates, then by the pandemic.

The latest sale, which should top up the UK’s creaking public purse by around £1.1billion and reduce the Treasury’s stake from 59.8 per cent to 54.8 per cent, will mark the first time the Government has sold any of its shares in Natwest – formerly known as RBS – to external investors since 2018.

Chancellor Rishi Sunak will be glad of the extra income, as he attempts to wrestle down the UK’s debt pile which has ballooned past £2 trillion during the pandemic. But the latest sales still represent a heavy loss for the Government. 

Natwest stock cost 502p at the time of the bailout – it is now worth under 200p.

But Natwest’s share price has also been held back by the revelation earlier this year that the Financial Conduct Authority had launched a criminal action against it, over allegations it failed to detect suspicious money laundering activity by one of its customers – understood to be Bradford-based gold dealership Fowler Oldfield.

* A rift has opened up between US banks and their European rivals over working-from-home policies. 

Wall Street titans such as Goldman Sachs and JP Morgan are calling staff back to the office from next month.

But European rivals such as HSBC and Lloyds Bank are taking a more cautious approach, as they attempt to use home-working on a regular basis to cut office space and slash costs.

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