UK government sells off nearly all of its stake in NatWest

In recent months, the UK Government has significantly reduced its stake in NatWest, culminating in a shareholding that has now fallen below 4%. This reduction is part of a broader plan to revert the bank back to private ownership, following its financial rescue during the 2008-2009 crisis when the government held an 84% stake in what was then known as the Royal Bank of Scotland. At the end of 2023, the Government's holding was still at 40%, but since then, it has been rapidly lowering its ownership share as NatWest prepares for full privatization. The transition of ownership marks a pivotal shift in NatWest’s corporate governance. For the first time in over 16 years, investment group BlackRock has emerged as the largest shareholder, surpassing the Government in terms of ownership. This shift indicates a significant change in the market structure and highlights the bank’s move toward regaining its status as a privately held entity. The decision to decrease government involvement aligns with the intentions of NatWest's management to be not just a public utility, but a competitive commercial bank. NatWest received considerable financial backing during the global financial crisis, with multi-billion pound bailouts from UK taxpayers aimed at stabilizing the banking sector. These bailouts were crucial in preventing wider economic collapse but left the government heavily invested in the banking institution. The government has been gradually divesting its shares since then, aiming to relieve taxpayers of this burden and allow the bank to operate independently. While plans for a retail share sale were proposed, they were scrapped after the Labour Government came into power, reflecting the changing priorities in government policy regarding the bank. This move towards private ownership is intended to benefit all shareholders, according to a NatWest spokesperson. By fully returning to private hands, the bank hopes to foster a more dynamic investment environment, ultimately benefitting shareholders, customers, and the economy as a whole.