Latest news with #Haythornthwaite
Yahoo
30-05-2025
- Business
- Yahoo
NatWest boss thanks British taxpayer for 2008 bailout after government sells remaining shares
The Chairman of NatWest has thanked British taxpayers for bailing out the bank during the 2008 financial crisis, as it returns into private ownership after 17 years. Rick Haythornthwaite, who succeeded Sir Howard Davies as chairman in April last year, expressed "gratitude to the taxpayer" for rescuing the bank, adding that the company had not forgotten "the lessons of the past" even as it pushes for changes to regulations that were introduced after the . Mr Haythornthwaite said the bank was in a reflective mood. "It's about a desire to express gratitude to the taxpayer. They not just rescued this bank, they protected millions of savers, of businesses, of homeowners. "From the bank's standpoint, it gave us the opportunity to completely restructure into a much safer and stronger bank." He spoke to Sky News as the government completed the sale of its remaining stake in the bank, formerly known as RBS, 17 years after a £46bn taxpayer-funded bailout that left the state with an 83% stake in the bank. Sky News' city editor Mark Kleinman broke the news at the weekend that the selloff was imminent and predicted that the taxpayers would lose about £10.2bn on the bailout. The government confirmed a £10.5bn loss on Friday. The government began unwinding its stake in 2021 and completed the sale today, posting a final loss of £10.5bn, and closing the door on one of the most turbulent periods in British economic history. It was also one of the most controversial periods. The bank bailouts, orchestrated by Alistair Darling and Gordon Brown, attracted public anger and scrutiny of the excessive risk-taking that took place in the City. A swathe of new regulations were implemented following the crisis, including new rules that forced banks to ring-fence their core retail banking arms from their investment arms, as well as a cap on bonuses. Read more from Sky News: While at the time the changes were viewed as necessary, Mr Haythornthwaite said the regulatory "pendulum may have swung too far." He said Britain had high-quality regulation, but there was scope to eliminate duplication in some areas. He said the current regime was compounding costs and inhibiting growth. "The regulator stepped in very necessarily 17 years ago and raised the standards it expects of banks, of their leaders, of people working in those places. It made demands of the culture and demands of its service to customers. All that is very right," Mr Haythornthwaite said. "Inevitably, the pendulum can swing slightly too far. One may question whether it's swung slightly too far, but I use the word 'slightly'." The Chancellor is receptive to his arguments. In her search for economic growth, Rachel Reeves is eyeing up the City. In a Mansion House speech last year, she said that some of those post-2009 reforms had "gone too far." The bonus cap, first implemented by the EU, has already been lifted, and major banks, including NatWest, are now calling for an end to ring-fencing too. The Chancellor has said she is "open-minded" about the idea. Some may be more nervous about that idea, less than two decades after the biggest bank bailout in history, but Mr Haythornthwaite said: "We're not going to forget the lessons of the past," adding: "This is not about triggering a race to the bottom. "It's very clear to me that this is a very different place. There's a focus on the ethics of running a bank, of really focusing on customers," he said. "This is not a place where we are looking for quick wins to serve the few."
The Herald Scotland
24-04-2025
- Business
- The Herald Scotland
NatWest investors give blessing to new executive pay policy
It came as NatWest chairman Rick Haythornthwaite declared the bank's return to full private ownership was 'in sight', with the UK Government's shareholding now less than 3%. He told shareholders the return to full private hands will be a 'symbolic moment' for the bank after a long period of recovery that followed the then Royal Bank of Scotland's £45.5 billion bailout by UK taxpayers at the height of the financial crisis. Mr Haythornthwaite said: 'For the first time since 2008, the Government is no longer the biggest shareholder in the bank, and we are on the verge of a return to full private ownership. This will be a symbolic moment, marking a new, forward-looking chapter in our story.' He added: 'We remain incredibly grateful to the Government, and to UK taxpayers, for their intervention and support, which protected millions of savers, homeowners and businesses at a time of global crisis.' Around 97% of voted shares at the AGM went in favour of the bank's new policy on executive pay, which followed the scrapping by regulators of the bankers' bonus cap. The new policy replaces the restricted share plan award with an annual performance share plan (PSP), capped at 300% of salary. It also increases the annual bonus opportunity from 100% of salary to 150% of salary. NatWest chief executive Paul Thwaite, who was appointed permanent success to Dame Alison Rose in February 2024, was paid a total of £4.9m for 2024. This included a base salary of £1.142m and variable pay of £2.463m for 2024. However, under the new structure, which is designed to incentivise performance, Mr Thwaite could earn up to £7.7m per year. Read more: Asked in a huddle with reporters after the AGM whether shareholders had any concern regarding risk with the new pay policy, Mr Haythornthwaite said the bank had been 'very measured'. He said: 'It has taken the ratio of fixed to variable [pay] from 1:1 to 2:1. Others are going further. We just feel, as step one, let's do that and make sure we are competitive, so we do attract the best talent and keep the best talent. But let's not open up the floodgates of risk exposure and forget the lessons of pre-2008 when it all got a bit out of sync. We don't think we are close to testing the limits of that. It was a good opportunity to make the shift and remain in sensible territory, with the recognition that others are pushing the boundaries.' The bank's bosses were also asked if acquisitions had been put 'on ice' amid the turbulence whipped up by US President Donald Trump's trade tariffs. NatWest has been active on this front in recent months with deals to acquire £2.3bn of 'prime residential mortgages' from Metro Bank and the takeover of the bulk of the Sainsbury's Bank operations. Mr Thwaite said: 'We made two small but important acquisitions last year… and they were right in our wheelhouse. They worked well for us. But as importantly, we grew the three businesses [of NatWest] – retail, commercial, and wealth – organically anyway. I am still confident we can grow our businesses organically. That is Plan A. 'From an acquisitions perspective, if there is the ability to add scale and capability, we will look at it, but I am on record consistently as saying it is a very high bar financially. It has to be very compelling for shareholders, it has to be very strategically [attractive]. We are not looking to change the direction of the bank.' Commenting broadly on the uncertainty that has followed Trump's 'Liberation Day' tariff announcement at the beginning of the month, Mr Thwaite said the upheaval 'generally simmers down corporate finance activity'. He also said the bank has 'no further plans' for international expansion. 'We think the shape of the bank at the moment allows us to grow 95% UK. We have important international outposts where it is needed for our client base. That works really well and that is what we are focused on.' Asked to estimate how much the UK Government had recouped from the sale of its shares in the bank - it has been reported the Treasury will recover £25bn after a bail-out worth £45.5bn - Mr Haythornthwaite said it was 'very difficult to tell'. He noted that the then UK Government had not intervened in the then RBS 'as an investment, this was a rescue of a sector, and they did well as a result of that… they protected millions of homeowners and businesses and ...savers'. He added: 'You need to ask them the question, but they would look at this as being a very smooth and pleasing exit'. Mr Thwaite noted that the return to private hands would 'not change strategically or operationally what we do'. Shares in NatWest closed up 3.65%, or 16.8p, at 476.5p.
Yahoo
23-04-2025
- Business
- Yahoo
NatWest vows not to forget ‘lessons' on bankers' bonuses
The chairman of NatWest has vowed not to forget 'the lessons of pre-2008' on senior staff bonuses when the bank returns to full private ownership, 16 years after being bailed out by the Government. Rick Haythornthwaite, speaking at the bank's annual general meeting (AGM) in Edinburgh on Wednesday, said the bank had now 'fixed the issues of the past' and had become a 'simpler, safer, customer-focused bank'. He also thanked UK taxpayers for their 'intervention and support', and said the Government's decision to 'rescue' the bank during the 2008 financial crisis had 'protected millions of savers, homeowners and businesses at a time of global crisis'. The AGM saw the bank's shareholders vote on 26 separate resolutions, all of which passed – including one that saw an increase in the level of bonuses payable to the bank's executive directors (EDs). This will see the maximum bonus for an ED rise from being equal to their salary to being 1.5 times the level of their salary. Speaking after the AGM, Mr Haythornthwaite described the increase in the level of performance-linked pay as 'very measured', and said it would make the bank more competitive at attracting and retaining 'the best talent'. He went on: 'But let's not open up the floodgates of risk exposure, let's not forget the lessons of pre-2008 where it all got a bit out of sync. 'We don't think we're close to testing the limits of that. It's not as if we've expressed an upper limit here. 'But I think it was a good opportunity to make the shift and remain in sensible territory for the recognition that others are pushing the boundaries.' Chief executive Paul Thwaite said shareholders had been 'supportive' of the change, and said they prefer a 'philosophy' whereby good performance is rewarded. During his AGM speech Mr Haythornthwaite said that after nearly two decades of recovery, growth was now 'top of the national agenda'. He continued: 'And, despite ongoing geopolitical uncertainty, competition and innovation are in focus once more. 'It is clear that the rhetoric is changing and we must keep up the momentum in order to create a secure, competitive environment that promotes growth, all in the service of the customer.' Speaking afterwards Mr Thwaite acknowledged the 'volatile' state of the markets in the wake of US President Donald Trump's tariffs, but said the bank had not yet seen a change in consumer behaviour. 'We're doing a lot of monitoring of the retail customer base, the commercial customer base, the corporate customer base,' the chief executive said. 'I think in terms of reaction, inevitably, it starts first in the corporate base, (which is) concerned about the uncertainty, thinking about what some of the medium-term impacts might be of the trade policies. 'In the consumer base, we haven't seen any material changes yet in actual behaviour. 'In sentiment surveys, there's definitely more kind of uncertainty and a little bit more concern about what the outlook may be. But that's more in sentiment than it is in actual changing behaviours.' During the AGM the board also faced a number of questions about the bank's dealings with fossil fuel companies, with members of Share Action asking whether it would commit to not watering down its policies on the environment. Mr Haythornthwaite responded that oil and gas represented a small fraction of NatWest's business, and that as the bank was currently in the process of reviewing its climate targets he could not make any commitments on policy at this stage. The AGM, held at NatWest's head office in Edinburgh, comes as the Government's shareholding in the bank has dropped below 3%, and is expected to hit zero by the middle of the year. At the end of 2023, the shareholding was at 40%, but the Treasury has been accelerating efforts to offload its stake by selling shares to retail investors and into the public market. NatWest received bailouts worth £45.4 billion funded by taxpayers during the financial crisis in 2008 and 2009, helping stabilise the country's banking sector. A spokesman for the Treasury said the bailout was to 'protect financial stability in the UK, with the independent OBR (Office for Budget Responsibility) stating that not intervening would likely have had much greater social and economic costs'. He added: 'We continue to sell down our NatWest shareholding and expect to fully dispose of this by the end of 2025-26, when market conditions allow and it represents value for taxpayers' money to do so.' Sign in to access your portfolio
Yahoo
23-04-2025
- Business
- Yahoo
NatWest chair thanks UK taxpayers for bailout ahead of return to private ownership
The chair of NatWest has thanked UK taxpayers for the bank's 2008 bailout weeks before the bank returns into private ownership, assuring shareholders that bosses had 'fixed the issues of the past' and would not 'open up floodgates of risk' despite government pressure. Rick Haythornthwaite made the comments as a small group of shareholders gathered at the Gogarburn campus on the outskirts of Edinburgh on Wednesday for the bank's annual investor meeting. He said NatWest – formerly known as Royal Bank of Scotland (RBS) – was indebted to taxpayers for the £46bn rescue package that kept the bank afloat during the financial crisis. The bailout was engineered by the late former chancellor Alistair Darling and then prime minister Gordon Brown, amid fears the UK's biggest bank could run out of cash after a period of expansion under Fred Goodwin, who was later stripped of his knighthood. 'It is important that we recognise the bold decision taken by the government of the day to step in and stabilise our banking system and, by extension, our economy, Haythornthwaite said in a speech on Wednesday. 'We remain incredibly grateful to the government, and to UK taxpayers, for their intervention and support, which protected millions of savers, homeowners and businesses at a time of global crisis.' He insisted that bosses had 'fixed the issues of the past' and that it was 'a much simpler, safer, customer-focused bank'. Related: NatWest on fast trajectory back to private ownership, boss says Mark Turnbull, 66, a Glasgow-based shareholder who has stuck with bank for 21 years says his investment was looking up. 'Some people in here said years ago, 'this is a dead bank', which it was in [terms of] the money it lost and the government's bailout,' Turnbull said. Now, he says, 'it's going well, it's making money.' That has come at a massive cost to the public. The government is only expected to recoup about £25bn of the £46bn it spent rescuing NatWest in 2008, with its shares sold below the 500p at which they were bought. On Wednesday, shares in NatWest were trading at about 475p. However, Haythornthwaite said the government was always expected to lose money on the bailout. 'I don't think they ever went into this is an investment. This was a rescue of a sector, and they did well as a result of that … they protected millions of homeowners and businesses and … savers,' NatWest's chair said. Extinction Rebellion demonstrators camped outside the AGM to protest against amendments to the bank's policy on fossil fuels which they fear have opened the door to further financing of oil and gas companies, including BP. 'NatWest, do your best, from BP divest, divest,' they chanted, as shareholders filed into the conference hall. While there has been speculation as to whether NatWest might consider expanding once the government's remaining 2.99% stake has been sold, bosses insisted there were no plans for new international ventures or any massive risk-taking moves. That is despite government pressure, with the chancellor, Rachel Reeves, continuing a Conservative project that pushed for more risk-taking across the City in order to boost UK growth. It has prompted a wave of regulatory reform, including removing the banker bonus cap that previously restricted performance-based payouts to two times salary. Haythornthwaite said it was an 'inflexion point'. 'After almost two decades of recovery for our banks, and for our country and economy more widely, growth is rightly at the top of the national agenda. And, despite ongoing geopolitical uncertainty, competition and innovation are in focus once more.' However, even as the bank boosted pay for its chief executive, Paul Thwaite, the chair insisted it was not aiming to encourage undue risk-taking with big bonuses. NatWest is raising maximum payouts for Thwaite by 43%, giving him the chance to earn up to £7.7m a year. That figure could soar to £9.5m if there was a 50% rise in NatWest's share price – given much of the payout is linked to long-term bonuses made up of the bank's own stock. NatWest only reinstated executive bonus payouts in 2022, having previously scrapped them under a directive by former chancellor George Osborne. 'So we do attract the best talent and keep the best talent, motivate them. But let's not open up floodgates of risk exposure. Let's not forget the lessons of pre-2008 when that all went a bit out of sync.' Shareholders approved the new policy on Wednesday, with nearly 98% of votes cast in favour. Peter Gifford, a dedicated shareholder since 2002, said bank bosses would be wise to move cautiously. 'Stay as you are and steer a steady course going forward, because we're living in difficult times,' he said. Sign in to access your portfolio
The Guardian
23-04-2025
- Business
- The Guardian
NatWest chair thanks UK taxpayers for bailout ahead of return to private ownership
The chair of NatWest has thanked UK taxpayers for the bank's 2008 bailout weeks before the bank returns into private ownership, assuring shareholders that bosses had 'fixed the issues of the past' and would not 'open up floodgates of risk' despite government pressure. Rick Haythornthwaite made the comments as a small group of shareholders gathered at the Gogarburn campus on the outskirts of Edinburgh on Wednesday for the bank's annual investor meeting. He said NatWest – formerly known as Royal Bank of Scotland (RBS) – was indebted to taxpayers for the £46bn rescue package that kept the bank afloat during the financial crisis. The bailout was engineered by the late former chancellor Alistair Darling and then prime minister Gordon Brown, amid fears the UK's biggest bank could run out of cash after a period of expansion under Fred Goodwin, who was later stripped of his knighthood. 'It is important that we recognise the bold decision taken by the government of the day to step in and stabilise our banking system and, by extension, our economy, Haythornthwaite said in a speech on Wednesday. 'We remain incredibly grateful to the government, and to UK taxpayers, for their intervention and support, which protected millions of savers, homeowners and businesses at a time of global crisis.' He insisted that bosses had 'fixed the issues of the past' and that it was 'a much simpler, safer, customer-focused bank'. Mark Turnbull, 66, a Glasgow-based shareholder who has stuck with bank for 21 years says his investment was looking up. 'Some people in here said years ago, 'this is a dead bank', which it was in [terms of] the money it lost and the government's bailout,' Turnbull said. Now, he says, 'it's going well, it's making money.' That has come at a massive cost to the public. The government is only expected to recoup about £25bn of the £46bn it spent rescuing NatWest in 2008, with its shares sold below the 500p at which they were bought. On Wednesday, shares in NatWest were trading at about 475p. However, Haythornthwaite said the government was always expected to lose money on the bailout. 'I don't think they ever went into this is an investment. This was a rescue of a sector, and they did well as a result of that … they protected millions of homeowners and businesses and … savers,' NatWest's chair said. Extinction Rebellion demonstrators camped outside the AGM to protest against amendments to the bank's policy on fossil fuels which they fear have opened the door to further financing of oil and gas companies, including BP. 'NatWest, do your best, from BP divest, divest,' they chanted, as shareholders filed into the conference hall. While there has been speculation as to whether NatWest might consider expanding once the government's remaining 2.99% stake has been sold, bosses insisted there were no plans for new international ventures or any massive risk-taking moves. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion That is despite government pressure, with the chancellor, Rachel Reeves, continuing a Conservative project that pushed for more risk-taking across the City in order to boost UK growth. It has prompted a wave of regulatory reform, including removing the banker bonus cap that previously restricted performance-based payouts to two times salary. Haythornthwaite said it was an 'inflexion point'. 'After almost two decades of recovery for our banks, and for our country and economy more widely, growth is rightly at the top of the national agenda. And, despite ongoing geopolitical uncertainty, competition and innovation are in focus once more.' However, even as the bank boosted pay for its chief executive, Paul Thwaite, the chair insisted it was not aiming to encourage undue risk-taking with big bonuses. NatWest is raising maximum payouts for Thwaite by 43%, giving him the chance to earn up to £7.7m a year. That figure could soar to £9.5m if there was a 50% rise in NatWest's share price – given much of the payout is linked to long-term bonuses made up of the bank's own stock. NatWest only reinstated executive bonus payouts in 2022, having previously scrapped them under a directive by former chancellor George Osborne. 'So we do attract the best talent and keep the best talent, motivate them. But let's not open up floodgates of risk exposure. Let's not forget the lessons of pre-2008 when that all went a bit out of sync.' Shareholders approved the new policy on Wednesday, with nearly 98% of votes cast in favour. Peter Gifford, a dedicated shareholder since 2002, said bank bosses would be wise to move cautiously. 'Stay as you are and steer a steady course going forward, because we're living in difficult times,' he said.
