- UK government sells 392m shares for 316.2p each, raising £1.24bn
The government has sold another stake in the UK’s NatWest, as the bank continues its long return to fully private ownership.
NatWest told shareholders on Friday that the Government had sold more than 392 million shares in an off-market transaction at 316.2 pence per unit, reflecting a small premium of around 0.5 per cent to its share price. closing at 314.75 pence on Thursday.
The latest sale raised more than £1.24bn and reduces the taxpayer’s stake in the lender from 26 per cent to around 22.5 per cent.
Rishi Sunak’s government hopes to sell remaining stake in UK’s NatWest by end 2026
The sale comes amid concerns that plans revealed in the Spring Budget to sell the Government’s entire remaining stake to retail investors later this summer had failed, with a sale of NatWest shares derailed by the looming general election from United Kingdom.
Taxpayers still have a large stake in NatWest after the Government was forced to bail out the lender during the 2008 financial crisis.
At its peak, the government owned 84 percent of the bank, but current plans call for its stake to be sold entirely by the end of 2026.
Chancellor Jeremy Hunt had lined up M&C Saatchi to launch an 1980s-style advertising campaign, ‘Tell Sid’, to boost investment in the London stock market.
But it will now be up to the next Government to decide whether to reactivate the sale and the Labor Party, leading in the polls, has yet to commit to going ahead with the plans if it wins on July 4.
NatWest intends to cancel around 222 million shares it bought from the Government and keep the remaining 170 million in treasury.
The bank said that holding these shares in treasury gives it the ability to cancel or reissue them “quickly and cost-effectively” at a later date, and “may provide the company with additional flexibility in managing its capital base.” .
NatWest chief executive Paul Thwaite added: “This transaction represents another important milestone for NatWest Group, building on recent momentum in reducing HM Treasury’s stake in the bank.
‘We believe this is a positive use of capital for the bank and our shareholders and represents further progress against the ambition to return NatWest Group to full private ownership.
“Our focus remains on delivering for our customers, which in turn will deliver for our shareholders and the UK economy.”
NatWest shares opened up 0.41 per cent at 317.5p on Friday morning. They have added more than 40 percent since the beginning of the year.