The British government has sold £1.24 billion worth of shares in NatWest Group back to the lender, it said today, decreasing its stake to around 22.5% from nearly 26% as it looks to end its ownership of the bank.
The transaction also comes as Britain's Treasury department confirmed it had shelved a mooted plan to sell shares to the general public, until after the July 4 general election.
"A retail offer will not happen during the election period," a Treasury spokesperson told Reuters today, confirming media reports last week.
The deal is the latest step in NatWest's nearly two-decade return towards private ownership after its state rescue during the 2008 financial crisis, in contrast with the US which had sold its major investments in rescued banks by 2011.
The state's plan, which involves selling shares in the market and runs until August 2025, had not been paused in connection with the off-market purchase, the UK government said today.
Finance Minister Jeremy Hunt has committed to return NatWest to full private ownership by the end of 2026.
The London-listed bank bought back 392 million shares from the government in an off-market purchase at 316 pence a share, as part of its existing contract with the state.
Shares in NatWest have gained about 45% this year.
The government's stake in the former Royal Bank of Scotland, which was bailed out in 2008 at the height of the global financial crisis, was once as high as 84%.
By March this year, it was no longer a controlling shareholder in the lender after its stake dipped below 30% after the sale of stock to institutional investors.
The settlement of the off-market purchase will occur on June 4, the government said in a statement.
Last month, NatWest reported first-quarter profit that fell by a less-than-expected 27%, having weathered a sector-wide squeeze on income.
