Natwest (NWG) Shares Traded Sideways on Retail Offer Rumours

The Natwest Group PLC (LON: NWG) share price traded sideways after news emerged that the British government was planning to sell its stake in the bank as early as the middle of this year. The UK government is gearing up to offer its Natwest shares to individual investors.

In his Autumn Statement last November, Chancellor Jeremy Hunt revealed plans to initiate a “Tell Sid”-like scheme to make the government's shares in the prominent Big Four bank available to the public within the coming year.

City Minister Bim Afolami indicated to City A.M. recently that the Treasury is poised to implement this plan in the forthcoming months. The shares will likely be offered at a discounted rate to attract retail investors.

Sources familiar with the matter disclosed to the Financial Times that Afolami is keen to commence the sale after Natwest appoints a permanent chief executive before the summer recess.

Paul Thwaite, the current interim CEO, is expected to serve in this role until at least July and is considered a strong candidate for the permanent position.

During the 2008 financial crisis, the government acquired a substantial 84% stake in Natwest, paying an average of 499p per share. Since then, it has progressively reduced its holding and aims to privatise the bank by 2026 completely.

Despite the Treasury's insistence on not selling its stake at an undervalued price, the decline in Natwest’s share value has resulted in taxpayer losses. Over the past year, the shares have dropped more than 27% to 224p.

The bank's stock dipped below 200p in October and November last year amid poor third-quarter results and controversy following the closure of former Ukip leader Nigel Farage's Coutts account.

Former CEO Dame Alison Rose stepped down in July after admitting to discussing Farage's Coutts account with the BBC. The government has several options for selling its shares in Natwest, including block sales to institutional investors, routine sales through its trading plan, and buybacks by Natwest.

A Treasury spokesperson told City A.M., “As stated in the Autumn Statement, we are examining potential ways to offer Natwest shares to retail customers over the next year, depending on market conditions and ensuring value for money. Further details will be provided when appropriate.”

Natwest share price. 

The Natwest share price traded sideways on news of a potential retail offer from the UK government.