La Britain announced on Monday that it has relinquished control of Natwest bank – formerly known as Royal Bank of Scotland (Rbs) – saved after the great crisis almost 14 years ago with an ocean of public money. Her Majesty's Treasury has reduced its stake in the institute's capital by taking it below the control threshold for the first time since 2008.
London Treasury drops below 50%
In detail, the government has sold 550 million shares at 220,5 pence each, making a total of over £1,2 billion (1,4 billion euro), cutting the stake by 50,6 to 48,1%.
“This is a milestone in the government's plan to return institutions that went public following the 2007-2008 financial crisis to private ownership,” the London Treasury wrote in a statement.
NatWest chief executive Alison Rose spoke of a "major milestone."
John Glen, UK Treasury Economy Secretary, added: “This sale means that the government is no longer the majority owner of NatWest Group and is therefore an important milestone in our plan to return the bank to the private sector. We will continue to prioritize value for money for taxpayers as we move forward with this plan."
The collapse of the Royal Bank of Scotland and the birth of Natwest
La Royal Bank of Scotland it fell into disrepair after the takeover – in the context of a consortium – of the Dutch bank ABN Amro, transaction concluded in 2007, just before the global financial crisis erupted. At the time, Rbs was held up with £45,5 billion from UK taxpayers: it was the largest bank bailout ever, at the end of which London came to control 84% of the group.
Since 2008, the group it reduced its total workforce by nearly 200 employees: in 2021 it had only 56.200. At the same time, the balance sheet has shrunk from over two trillion to £782 billion. The Bank has exited 35 countries and currently operates in 19 countries. The balance sheets returned to profit in 2017, after nine consecutive years at a loss. The group's performance, however, was marred by litigation and conduct costs, including settlements for an improper sales credit insurance scandal.
Alison Rose, the first woman to head a major UK lender, has renamed the NatWest bank in an attempt to cut ties with the past. Due to the pandemic, the bank returned to the red in 2020, following provisions to cover potential fallout from Covid. After that, balance sheets found their way back to profits last year as the UK economy recovered from the aftermath of the pandemic.
NatWest shares, listed on the London Stock Exchange, rose 1,9% to 224,70 pence earlier in the afternoon.
Five years ago the UK had already reprivatized Lloyds Banking Group, which was also subject to a public maxi-bailout during the crisis.
