The UK Government is selling £1.26billion of NatWest shares back to the bank, reducing its stake in the lender it bailed out during the 2008 financial crisis to below 40 per cent.
The sale of 469million shares at Friday’s closing price of 268.4p per share will see the Government’s stake in NatWest fall from 41.4 per cent to 38.6 per cent.
It comes a month after HM Treasury announced it had pushed back plans to sell part of its stake in NatWest by two years after turmoil in the banking sector sent share prices tumbling.
Share sale: NatWest has bought £1.26bn of its shares back from the Government
NatWest, formerly Royal Bank of Scotland, was rescued by the Government in a £45.5billion bailout in 2008.
The Government bought its stake for 502p per share. Today, however, they are worth around 270p, reflecting a heavy loss for the taxpayer.
In April, the Government said it will aim to offload a 15 per cent stake by August 2025, instead of August this year.
This is to make sure that the taxpayer gets ‘value for money’ for the shares, which have been depressed in recent weeks after the collapse of Silicon Valley Bank and UBS’ takeover of Credit Suisse raised fears over the stability of the financial system.
In last month’s Budget, the Government confirmed it was aiming to fully privatise NatWest by 2026.
NatWest shares have struggled so far this year, but have soared 15 per cent over the last 12 months.
Russ Mould, investment director at AJ Bell, said: ‘The Government has sold another chunk of shares in NatWest but the fact it is still left holding 38.6 per cent means there continues to be a big overhang for the stock, which is likely to remain the case for some time given the slow pace of selling down.
‘After all, it’s been 15 years since the bank was bailed out by the government and the latter still owns more than a third of the company.’
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