UK government to cut size of £12.6bn stake in NatWest

The UK government is to sell more of its £12.6bn-worth of shares in NatWest Group over the next 12 months as it seeks to return the bank fully to private ownership.

It has appointed Morgan Stanley to manage a “measured and orderly” sale of its NatWest shares via a trading plan, according to a statement released on Thursday said. No stake size was specified.

The government took control of NatWest, then known as Royal Bank of Scotland, during the 2008 financial crisis and still owns a 54.7 per cent stake.

The trading plan will take effect from Thursday, with the earliest sales set for August 12 following the expiry of the lock-up period agreed with bookrunners when the Treasury last sold part of its shareholding in May.

The government intends to sell no more than 15 per cent of the “aggregate total trading volume” in the bank over the duration of the plan, which can be extended until August 12 next year.

The number of shares to be sold will depend on market conditions. The statement from UK Government Investments, which manages the government’s shareholding, said the shares would not be sold below a fair price and must deliver value for money to the taxpayer. Other disposal options will be kept open.

The Treasury in May cut its stake in NatWest for the second time in two months. It sold about 5 per cent of NatWest stock, which at the time was worth about £1.1bn, raising the prospect that the bank could be returned to majority private ownership within the year.