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NatWest knocked lower, £350mln banker bonuses rumoured

Published Feb 12, 2024 12:47 Updated Feb 12, 2024 13:10
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Proactive Investors - NatWest Group PLC (LON:NWG) was trading 2.3% lower from Friday’s close on Monday.

Over the weekend, Sky News reported that the government-backed FTSE 100 lender intends to pay out £350 million in staff bonuses before its impending retail share offer.

Though this rumoured figure will be below last year’s £367 million payout, NatWest bonuses are contentious due to the bank’s part public-owned status, not to mention a tumultuous year of controversies linked to the blacklisting of former UKIP leader Nigel Farage.

Former chief executive Dame Alison Rose rescinded £7 million of bonuses after stepping down from her position amid the Farage controversy, in which the bank closed his Coutts account for political reasons.

NatWest Group plc admitted to serious failings in the treatment of Nigel Farage and “clear shortcomings” in how the decision to close his bank account with subsidiary Coutts came about.

NatWest’s public offer

The sale of shares in NatWest to the general public could happen as early as June, UK Government Investments confirmed last week.

NatWest was bailed out by the public after the 2008 Global Financial Crisis caused the collapse of its investment banking arm, which was trading as the Royal Bank of Scotland (LON:NWG) at the time.

Under the bailout, the government under then-Prime Minister Gordon Brown bought a 58% stake in NatWest for £37 billion.

The government has since reduced its stake through institutional sales and share repurchases by NatWest itself, but has yet to offer shares to the public.

A retail offer "potentially could happen" as soon as June, Holger Vieten, the director of UK Government Investments (UKGI), told the Treasury Select Committee last Tuesday. "The very earliest could be around summer time, but we don't have an exact date."

Chancellor Jeremy Hunt posited the idea of a public sale of NatWest shares in early 2023 under the proviso of achieving "full value for money".

Hunt suggested the government wants all remaining NatWest shares off its books by 2026.

NatWest will publish its fourth-quarter results this Friday, with UBS predicting profits of £1.2bn, down 24% and £6.25bn for the full twelve months.

Read more on Proactive Investors UK

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NatWest knocked lower, £350mln banker bonuses rumoured
 

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