Government sells final NatWest shares after 17 years of bailout

In the United Kingdom, the government has completed the sale of its remaining shares in NatWest bank, marking the end of a 17-year period since the bank was bailed out during the 2008 financial crisis. The rescue operation involved significant funding where nearly £46 billion was injected into NatWest, then known as Royal Bank of Scotland, to prevent its collapse. Since 2015, the Treasury had gradually offloaded its shares, selling the final stake with a realized loss to taxpayers of approximately £10.5 billion. The decision to sell was influenced by rising share prices and was viewed as a significant milestone for both the bank and the broader banking industry in the UK. The bailout decision in 2008 was made by the Labour government amid fears of the bank's insolvency, following years of rapid expansion that made it one of the largest banks globally. At the height of the crisis, government ownership reached 84.4%, and share sales did not commence until 2015 when the bank's stability improved. The Treasury's recovery from the bailout has amounted to £35 billion through a combination of share sales and dividends. The latest sale marks NatWest's full return to private ownership, allowing the bank to move forward without the government's stake, which had served as a safety net during turbulent times. Chancellor Rachel Reeves stated that the government’s intervention was necessary for protecting savers and businesses, reflecting on the right decision made during a crisis that threatened the financial landscape of the country. As the government exits its role in the banking sector, NatWest Group's chief executive, Paul Thwaite, emphasized the lack of operational impact from the sale and expressed optimism for future growth under private ownership. The banking environment has evolved considerably since the financial crisis, with stricter regulations and higher capital requirements, reinforcing the sector's resilience. As the privatization of NatWest concludes, leaders from the bank expect improved innovation and operational agility moving forward. This change is seen as an opportunity for NatWest to attract new global investors who are eager to support its growth strategies. The sale of the last public stake not only symbolizes the end of an era but also represents a lesson learned from past mistakes, ensuring that the financial sector is better prepared to handle future economic challenges.