‘NatWest could have been transformed into a people’s bank…but the government has shown no vision.’
The government has just announced plans to sell more of its stake in NatWest, despite shares being worth less than half what they were when taxpayers bailed out the bank after the financial crisis.
Yet experts, unions and non-profits believe this move is a huge missed opportunity to transform Natwest “into a people’s bank” which helps to rejuvenate the economy, supports small businesses and invests in green industries.
Taxpayers bailed out NatWest for £45.5bn more than 10 years ago and it’s market value now stands at £23bn.
The government has said shares “will only be sold at a price that represents value for money for taxpayers”.
Public ownership of Natwest has already fallen from 84 percent in 2009 to 54.7 percent. Further sales would mean the government losing its majority stake in the bank.
Simon Youel, head of policy and advocacy at Positive Money said instead of selling it at a loss the government should be taking advantage of its stake in the bank.
He said: “The enormous decrease in NatWest’s share price since the bailout would mean that we’re getting less than half what we paid for it, making the government’s promise that shares ‘will only be sold at a price that represents value for money for taxpayers’ impossible to keep.
“Instead of selling at a loss, the government should take advantage of its stake in NatWest to make the bank work in the public interest. Left to their own devices, Britain’s big shareholder owned banks will simply prioritise bidding up asset prices rather than productive investment.”
Simon continued that as we start to recover from the pandemic, we need banks “that are willing and able to support small businesses” and the real economy more than ever.
“Selling now would be another missed opportunity to truly build back better and level up the country,” he added.
House of Lords member and Emeritus Professor of Accounting, Prem Sikka said: “Another transfer of wealth from taxpayers to City speculators and Conservative cronies. It will neither improve competition nor services to customers.
“NatWest could have been transformed into a people’s bank to provide services, support SMEs; invest in infrastructure, green industries, revive manufacturing and rejuvenate the economy, but the government has shown no vision.”
Lucy Skoulding is a freelance journalist and human rights masters student. Follow her on Twitter here.
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