Latest news with #PaulThwaite
Daily Mail
a day ago
- Business
- Daily Mail
Opinion: Financial crisis of 2008 still haunts us
The return of NatWest, the bank formerly known as RBS, to the private sector, has more symbolic than practical significance. The sale of the final remnant will not have much impact in the real world of customers, staff and the banking industry more widely. Even so, the final exit of the long-suffering British taxpayer after 17 years – and at a hefty £10billion loss – is a good moment for reflection. Paul Thwaite, the current chief executive, was a relatively junior figure 17 years ago, when the bank came close to going under and taking the entire UK financial system with it. Along with other executives of his generation who began their careers back then, his mindset has been formed by that traumatic experience. Banks, and bankers, are different beasts now. The light touch regulation of the pre-crisis era has been replaced by rules that arguably are too restrictive. There is little trace of the arrogance of former RBS boss Fred Goodwin, Adam Applegarth at Northern Rock and their Wall Street counterparts in the bank CEOs of today. They are considerably more boring – in a good way. The political backdrop is also very different now, though sadly, not necessarily in such a good way. One can trace a line directly from the crisis to the rise of populist leaders on the Left and Right. Pictured: Northern Rock. Disaffection, mistrust and contempt for institutions have become an ingrained feature of the political landscape and this has culminated in the re-election of Donald Trump. In the years running up to 2008, the belief was that capitalism had triumphed over communism with the fall of the Iron and the Bamboo curtains. Globalisation – the free flow of money, trade and people – seemed to be lifting millions of people out of abject poverty. Some communities, including in the rust belt of the US where Trump has won over voters, were being left behind. Cheap credit, including sub-prime mortgages, appeared to be papering over a lot of those cracks. The events of 2008 damaged confidence in experts of all sorts, in elected officials, regulators and institutions. One can draw a line from the debt disasters that hit European nations, including Greece, Spain, Italy and Ireland, to the Brexit referendum. Back in the day, US presidents George W Bush and Barack Obama were at least trying to stabilise the situation rather than throwing petrol on the flames. In the UK, Gordon Brown, a man who may well be judged far more kindly by history than he was at the time, hosted the G20 summit in London in 2009. Many view this gathering, where world leaders pledged to improve financial regulation and to make more than $1trillion available to support the global economy, as a turning point. Central banks flooded economies with emergency cash through Quantitative Easing to keep the system afloat – a necessary measure at the time, though it went on far too long. Wall Street titan Jamie Dimon, then as now the chief executive of JP Morgan, provided a cool head and calm leadership. Dimon, still a towering figure, has been warning Trump about his tariff plans and confrontational foreign agenda.
Sky News
a day ago
- Business
- Sky News
Newly re-privatised NatWest names Chamberlain as retail bank chief
NatWest Group has picked a new head of its high street branch network in the lender's first significant appointment since ending its 17-year tenure in partial taxpayer ownership. Sky News has learnt that Solange Chamberlain has been chosen as NatWest's new retail bank chief executive, nearly six months after predecessor David Lindberg's departure was announced. Ms Chamberlain, who has worked for NatWest since 2019, will take up her new role on 1 July, subject to regulatory approval. A former investment banker, she will report to Paul Thwaite, the bank's group chief executive. Her previous roles at NatWest include chief operating officer of its commercial bank and more recently as group director of strategic development. NatWest's retail bank has more than 18 million customers across Britain, making it one of the industry's four biggest retail banks alongside Barclays, HSBC and Lloyds Banking Group. The recent acquisition of Sainsbury's Bank added 1 million accounts to NatWest's retail customer base. Responding to an enquiry from Sky News, NatWest confirmed the appointment on Monday afternoon. Mr Thwaite said in a statement that Ms Chamberlain's "knowledge of our customers, sharp strategic thinking, and track record of transformation delivery will help us to grow our retail business and succeed with customers". On Friday, the Treasury sold the last of its shareholding in NatWest, having bailed out the then Royal Bank of Scotland with £45.5bn of taxpayers' money during the 2008 financial crisis. On Monday, shares in the bank were trading at around 524.6p, giving it a market value of more than £42bn.
Daily Mail
2 days ago
- Business
- Daily Mail
RUTH SUNDERLAND: Financial crisis of 2008 still haunts us
The return of NatWest, the bank formerly known as RBS, to the private sector, has more symbolic than practical significance. The sale of the final remnant will not have much impact in the real world of customers, staff and the banking industry more widely. Even so, the final exit of the long-suffering British taxpayer after 17 years – and at a hefty £10billion loss – is a good moment for reflection. Paul Thwaite, the current chief executive, was a relatively junior figure 17 years ago, when the bank came close to going under and taking the entire UK financial system with it. Along with other executives of his generation who began their careers back then, his mindset has been formed by that traumatic experience. Banks, and bankers, are different beasts now. The light touch regulation of the pre-crisis era has been replaced by rules that arguably are too restrictive. There is little trace of the arrogance of former RBS boss Fred Goodwin, Adam Applegarth at Northern Rock and their Wall Street counterparts in the bank CEOs of today. They are considerably more boring – in a good way. The political backdrop is also very different now, though sadly, not necessarily in such a good way. One can trace a line directly from the crisis to the rise of populist leaders on the Left and Right. Disaffection, mistrust and contempt for institutions have become an ingrained feature of the political landscape and this has culminated in the re-election of Donald Trump. In the years running up to 2008, the belief was that capitalism had triumphed over communism with the fall of the Iron and the Bamboo curtains. Globalisation – the free flow of money, trade and people – seemed to be lifting millions of people out of abject poverty. Some communities, including in the rust belt of the US where Trump has won over voters, were being left behind. Cheap credit, including sub-prime mortgages, appeared to be papering over a lot of those cracks. The events of 2008 damaged confidence in experts of all sorts, in elected officials, regulators and institutions. One can draw a line from the debt disasters that hit European nations, including Greece, Spain, Italy and Ireland, to the Brexit referendum. Back in the day, US presidents George W Bush and Barack Obama were at least trying to stabilise the situation rather than throwing petrol on the flames. In the UK, Gordon Brown, a man who may well be judged far more kindly by history than he was at the time, hosted the G20 summit in London in 2009. Many view this gathering, where world leaders pledged to improve financial regulation and to make more than $1trillion available to support the global economy, as a turning point. Central banks flooded economies with emergency cash through Quantitative Easing to keep the system afloat – a necessary measure at the time, though it went on far too long. Wall Street titan Jamie Dimon, then as now the chief executive of JP Morgan, provided a cool head and calm leadership. Dimon, still a towering figure, has been warning Trump about his tariff plans and confrontational foreign agenda. Unfortunately, Trump looks more likely to be the cause of the next crisis than its solution. At the time of the crisis, there were fears the global financial system would implode. That apocalyptic scenario was avoided, but we are still living with the consequences of 2008. Trump is one of them.
Yahoo
4 days ago
- Business
- Yahoo
Natwest returns to private ownership
Natwest has finally re-entered private ownership ending one of British banking's longest-running sagas. The government sold off its remaining 0.26 per cent stake in the group on Friday marking a full exit from the lender. The Treasury's share of the FTSE 100 lender dates back to the 2008 financial crisis. Natwest, then under the Royal Bank of Scotland moniker, received a £46bn bailout from taxpayer funds as it fought for survival. The government acquired an 80 per cent stake in Natwest as part of its rescue plan. The firm was not the only lender bailed out by the government. Lloyds received a £20bn injection for a 43 per cent stake. The Treasury pocketed around £4.9bn in dividend payments during its ownership with fees and other payments topping £5.6bn. However, today the government confirmed a £10.5bn loss to taxpayers since the bank was rescued during the 2008 financial crisis. Natwest follows Lloyds Banking Group, which departed from its status as a partially state-owned enterprise in 2017. Natwest CEO Paul Thwaite said: 'This is a significant moment for Natwest Group, for all those who work here and for the UK more widely. As we turn the page on the financial crisis, we can look to the future with confidence, without forgetting the lessons of the past. 'I am proud to have been part of the team that has helped build a simpler, safer, more customer-focussed bank. It is thanks to the incredible loyalty of our customers and colleagues, along with the support of our shareholders – including the UK taxpayer – that this change has been possible. 'Today we have a strategy that is working, positive momentum in our business and a clear ambition to succeed with our customers. 'This is a sector that matters; strong economies need strong banks, and vice versa. At a time when there is a clear intent to deliver growth, Natwest is ready to step up to the challenge, shaping our future as a vital and trusted partner to our customers and to the UK itself.' Up until 2022, the taxpayer was still the majority shareholder in the company. The government sold a chunk of its shares in March 2022, taking its stake to 48.1 per cent. But in the last year it has accelerated its sell-off to push Natwest back into private ownership. On January 14 2025, the government reduced its stake to 8.9 per cent, following a sale of 86.4m shares. And in early May, Natwest announced the government's holding had fallen below one per cent, averaging a two per cent reduction per month. Dan Coatsworth, investment analyst at AJ Bell, told : 'We don't know if it has been hands-on or stayed at arms' length, but it's fair to suggest that Natwest has followed the same path as other UK banks since the global financial crisis.' During the bank's annual general meeting, chairman Rick Haythornthwaite said the government had been 'positive and patient through the investing years'. Natwest stock notched a decade high of 478.80p in April, but the figure remains drastically dwarfed by pre-financial crisis highs of 5,236.28p. The lender pocketed £4bn in income for the first-quarter of 2025 after a rush to beat stamp duty deadlines boosted takings. The firm booked £1.8bn in pre-tax profit, surpassing the £1.6bn pencilled in by analysts. As Brits flocked to beat the Chancellor's March 31 deadline, net lending increased by £3.4bn to £371.9bn. Analysts hailed the lender's strategic positioning as operating expenses fell 8.5 per cent to £2bn. John Moore, senior investment manager at RBC Brewin Dolphin, said: 'With some of its peers potentially retreating from the UK, that may open up opportunities for acquisition or other forms of expansion, which would provide further scale while sticking to the three pillars of the bank's strategy.' Natwest lodged an £11bn bid for Santander UK's retail arm earlier this year, according to reports from the Financial Times. Talks between the two lenders are no longer active, but should the takeover have gone ahead it would have birthed the biggest banking deal since the financial crisis. Whilst unsuccessful, the proposal could offer insight into Natwest's future post-privatisiation. The bank kicked off its shopping spree last year after snapping up the majority of Sainsbury's banking assets and purchasing Metro Bank's £2.5bn residential mortgages portfolio. Natwest is set to deliver its half-year results on July 25 – and for the first time in 15 years – in private ownership. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Mint
27-05-2025
- Business
- Mint
NatWest Gets Ready for Life After UK Government Ownership
Freed from the clutches of government ownership, NatWest Group Plc is getting ready to chart its own course for the first time in almost two decades. The UK has less than 1% remaining of its crisis-era holding in the lender and could sell out any day now. While the moment is mostly symbolic for Chief Executive Officer Paul Thwaite and Chairman Rick Haythornthwaite, getting the government off the shareholder register will be the final step in shedding NatWest's reputation as a beleaguered bank that was almost destroyed by an acquisition spree 17 years ago. The pair, who have steered the company as the government rapidly sold off its stake that was £9 billion in size roughly two years ago, are already building on the firm's shift from recovery to expansion. They've acquired the majority of J Sainsbury Plc's banking assets. They picked up a mortgage portfolio from Metro Bank Holdings Plc in a £2.5 billion deal last year. And, more recently, they reportedly showed interest in Banco Santander SA's UK business. In addition, they've crafted plans to go after a wider set of affluent Britons in the wealth management business. They're also seeking a major role in bankrolling ambitious infrastructure projects that Prime Minister Keir Starmer's Labour government is planning to boost the economy. 'From an acquisition perspective, if there's the ability to add scale, add capability – we'll look at it,' Thwaite told reporters on the sidelines of the company's annual shareholder meeting in April, while cautioning that any deals aren't likely to transform the bank's overall direction and that the firm will remain disciplined. 'Rick and I remain very ambitious for the business.' Thwaite said the bar for further acquisitions remains very high and won't take the bank into any new businesses or geographies. The Santander bid, for instance, would have only given the bank a greater presence in the UK consumer banking scene it already dominates. 'We're not looking to change the direction of the bank or anything like that,' he said. 'It's a brilliant bank, it has three great businesses, it has lots of potential to grow. In some ways, boring is good in banks.' In many ways, the British government rescued a very different bank than the NatWest of today. Back then, the group was known as Royal Bank of Scotland, with a £2.2 trillion balance sheet and nearly 200,000 staff around the world — the result of RBS buying NatWest around the turn of the millennium, before it swallowed ABN Amro's investment bank in 2007. The ABN Amro deal, which executives struck just months before the start of the financial crisis, was subsequently described as 'the one distinguishing feature in the catalogue of shame, in which all bankers sit at the moment' by RBS's then-deputy CEO Gordon Pell. In a series of emergency cash injections, Westminster became the majority shareholder in NatWest, ultimately controlling 84% as UK taxpayers shouldered the nearly £46 billion bailout bill. Without the rescue, the government feared contagion that could have destabilized the rest of the financial system. While fellow bailout recipient Lloyds Banking Group Plc regained its private status in 2017 and left the Treasury a windfall of £894 million, NatWest proved to be a different story as the high-street lender spent years struggling to improve its profitability. Even after the final sale, the government will be roughly £10 billion in the red on its support package for the bank, according to Bloomberg calculations. 'It was hard to know what the dimensions were of the crisis you were trying to fix,' Stephen Hester, who stepped in as chief executive of the lender in 2008, recalled in an interview. 'The financial world was coming apart at the seams.' During Hester's tenure the bank cut more than 39,000 jobs and exited more than 20 countries, while facing years of legal proceedings for its role in the Libor-rigging scandal. Under European state aid rules, it was required to sell its payments unit WorldPay, missing out on billions of pounds of value growth within a few years of the disposal. At the start, the political scrutiny was intense, he said. 'In the first six to 12 months of the crisis, there was a huge amount of partnership between politicians and me and the bank because we were all trying to deal with the crisis as best we could,' Hester said. 'As things calmed down, the differences between the political agenda and the rational business agenda started to increase.' During the 2010s, the restructuring continued under CEO Ross McEwan and Chairman Howard Davies. By 2023, which was Davies's final full year as chair, the bank booked a pretax profit of £6.2 billion – a testament to how far it had come since suffering losses of £41 billion in 2008. The majority of those earnings came from domestic retail and commercial banking, after the group dropped most of its investment banking operations. Now, the NatWest balance sheet is just £708 billion, with a headcount that's less than a third of the number during its heyday. Some of the retrenchment was in lockstep with other banks, even those that didn't receive bailouts, as the entire industry fell into line with a global crackdown on practices seen as too risky. Barclays Plc, for instance, escaped without a state rescue but still disposed of several 'non-core' units. Yet for NatWest in particular, it was clear the UK government was watching. Take bonuses: in 2011, then-Chancellor of the Exchequer George Osborne stressed that he expected the firm to rein in awards and 'should be a back-marker in the industry, instead of the front-runner it once was.' The bank duly cut its bonus pool. Hester waived a bonus in 2012 after a row in the House of Commons over his pay, and every post-crisis CEO until Thwaite has forfeited some element of their awards over the years. Just as the improving performance was taking the heat off the lender, NatWest got enmeshed in a political controversy, complicated further by the government's presence on the shareholder register. In 2023, wealth subsidiary Coutts's decision to drop right-wing politician Nigel Farage as a client kicked off a firestorm, eventually forcing then CEO Alison Rose — Thwaite's predecessor — to resign. Davies, for his part, came under criticism from politicians for backing Rose, whose departure came after she briefed a journalist on the matter. Today, he says, he would do nothing different. 'The board made what I thought were reasonable decisions and the regulators didn't contest that,' Davies said. 'It was unfortunate' that the state was still a controlling shareholder and 'it was difficult for them to say nothing. I hope they would not take the same interest in it now as they did then,' he added. Farage settled with NatWest in March. A month later, the bank's shares jumped to a 14-year-high after its results beat estimates in the first quarter, despite the headwinds the global economy faces. The government's selloff has accelerated in the past year, taking advantage as higher interest rates buoyed financial stocks. The sales, though, crystallized losses on the rescue, with NatWest shares only breaking above the roughly 500 pence-per-share initial cost of the bailout a few weeks ago. 'I know it's best to sell into a rising market but the sales have been much too speedy in recent years, in my view, and that's another taxpayer cost,' said Philip Hampton, who chaired the bank until 2015. 'On an individual note, I think Alison Rose was very badly treated, which confirms again how cheaply political government ownership can be.' With assistance from Joe Mayes, Harry Wilson and Jack Witzig. This article was generated from an automated news agency feed without modifications to text.
