The British government’s exit from NatWest has gained momentum as its ownership stake diminishes to just under 11 per cent of the FTSE 100 bank. The reduction comes through a methodical trading plan designed to gradually release shares into the market.
The latest share reduction follows a significant £1 billion buyback deal with NatWest merely two weeks ago, substantially advancing the state’s withdrawal from the banking giant. At the current divestment rate, the government is projected to completely exit its position in NatWest during the first half of 2025.
This progression marks a pivotal shift from the government’s rescue operation between 2008 and 2009, when the global financial crisis necessitated state intervention, resulting in an almost 85 per cent ownership of what was then Royal Bank of Scotland Group. The government initiated its divestment strategy in 2015, with sales accelerating notably since early 2024, when state ownership stood at approximately 38 per cent.
NatWest shares have demonstrated remarkable performance, surging 77 per cent in 2024 and recently achieving a nine-year peak. Despite this impressive growth, the government’s share sales have consistently occurred below the original rescue price of 502 pence per share, representing a loss on the initial investment. The bank’s shares experienced a 2.5 per cent decline on Friday, closing at 390.75 pence, amid broader banking sector weakness triggered by economic data suggesting future interest rate reductions.
The banking landscape continues to evolve as digital challenger Revolut announced plans to expand its European services in 2025, including mortgage offerings in Lithuania, Ireland and France, alongside branded ATMs in Spain. The announcement coincided with the fintech company’s celebration of reaching 50 million global customers.
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