NatWest setback as Labour kiboshes ‘Tell Sid’ share sale
- Rachel Reeves not keen to offer Government’s £5.6bn stake to ordinary investors
- Reeves wants pension funds, insurers and asset managers to benefit
- Critics say move is a missed opportunity
Hopes of a ‘Tell Sid’ NatWest share sell-off to the public have been dashed as Labour lines up a sale to institutional investors.
Chancellor Rachel Reeves is keen to offer the Government’s £5.6billion stake to pension funds, insurers and asset managers, rather than ordinary investors, sources say.
The move is a hammer blow to the bank and retail investors, with critics saying it is a missed opportunity to encourage more people to develop long-term saving and investment habits.
The last Labour government rescued the lender during the 2008 financial crisis and at its peak the taxpayer’s stake was 84 per cent.
This month it fell below 20 per cent. The Conservatives planned a sale this summer with former chancellor Jeremy Hunt priming M&C Saatchi to launch a ‘Tell Sid’ advertising campaign – the slogan used to encourage people to buy shares in British Gas in 1986.
But NatWest said it had to spend £24m on a campaign which never saw the light of day.
Back in the 80s broadcaster Sir Trevor McDonald asked the public: ‘Are you in?’ in a TV campaign that aimed to boost the beleaguered stock market.
Danni Hewson, head of financial analysis at AJ Bell, said: ‘Ditching the razzamatazz of a ‘Tell Sid’-style campaign could be a missed opportunity to get people investing for the first time. Rachel Reeves wants investment in great British companies primarily through our pension schemes.
‘With so much of people’s savings still locked up in cash, a retail offer could be a catalyst for change.’
Mark Northway from investment not-for-profit group ShareSoc added: ‘It would be a massive mistake to exclude retail and individual investors.
‘This is an opportunity to redistribute to UK taxpayers who have taken on the burden of NatWest for the last few years.’
Meanwhile, NatWest posted bumper financial results for the first half. Chief executive Paul Thwaites hailed the strong performance which included profits of £3billion and a 6p interim dividend – 9 per cent more than last year’s gift to shareholders.
Shares rose 7 per cent, or 23.8p, to 361.9p, adding to gains of just under 60 per cent in six months. And the bank has also agreed to buy £2.5billion of UK prime residential mortgages from Metro Bank.
Thwaites said: ‘Customers are beginning to feel more confident, with activity increasing, and we are well positioned to help unlock growth through our regional network.’
He expects share sale details to emerge in the autumn. Neither Nat West and Labour commented on whether a public share sale looked likely.
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