NatWest setback as Labour rejects ‘Tell Sid’ share sale
- Rachel Reeves is not keen on offering the government’s £5.6bn stake to ordinary investors
Hopes of a ‘Tell Sid’ NatWest share sale to the public have been dashed as Labour prepares a sale to institutional investors.
Finance Minister Rachel Reeves is keen to offer the government’s £5.6bn stake to pension funds, insurers and asset managers rather than ordinary investors, sources say.
The move is a huge blow to banks and private investors, and critics say it is a missed opportunity to encourage more people to develop long-term savings and investment habits.
The last Labour government bailed out 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 percent. The Conservatives had planned a sale this summer, with former chancellor Jeremy Hunt preparing M&C Saatchi to launch a “Tell Sid” advertising campaign – the slogan used in 1986 to encourage people to buy shares in British Gas.
But NatWest said it had to spend £24m on a campaign that never got off the ground.
In the 1980s, presenter Sir Trevor McDonald asked the audience, “Are you in?” in a TV campaign aimed at boosting the troubled stock market.
Danni Hewson, head of financial analysis at AJ Bell, said: “Removing the razzamatazz of a ‘Tell Sid’-style campaign could be a missed opportunity to get people to invest for the first time. Rachel Reeves is all about investing in great British companies through our pension schemes.
‘With so many people still holding their savings in cash, an on-the-shop offer could be a catalyst for change.’
Mark Northway of the not-for-profit investment group ShareSoc added: ‘It would be a big mistake to exclude retail and individual investors.
‘This is an opportunity to redistribute the burden to UK taxpayers who have borne the burden of NatWest over the past few years.’
Meanwhile, NatWest posted bumper first-half financial results. Chief executive Paul Thwaites praised the strong performance, including profits of £3bn and an interim dividend of 6p – a 9 per cent increase on last year’s gift to shareholders.
Shares rose 7 percent, or 23.8p, to 361.9p, adding to a gain of just under 60 percent in six months. And the bank has also agreed to buy £2.5 billion of UK prime residential mortgages from Metro Bank.
Thwaites said: ‘Customers are growing in confidence, activity is increasing and we are well positioned to deliver growth through our regional network.’
He expects details of the share sale to be released in the autumn. Neither Nat West nor Labour commented on whether a public share sale seemed likely.
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