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Ordinary investors will be awarded ‘bonus’ shares in NatWest Group if they hold onto stock they acquire in the taxpayer-backed bank, under a plan expected to be finalised by ministers later this month.

Sky News has learnt key details of the options being explored by the Treasury for a multibillion pound retail offer of NatWest shares, including a likely £10,000 cap on applications from members of the public.

Jeremy Hunt, the chancellor, announced in last year’s autumn statement that he would explore a mass-market share sale “to create a new generation of retail investors”.

Since that point, further buybacks by the bank and stock sales by the government have reduced the taxpayer’s stake to around 28% – worth about £7bn at NatWest’s current valuation.

The retail offer will be launched alongside an institutional placing of shares in the bank which could in aggregate lead to the Treasury’s stake falling to as low as 10%, sources indicated this weekend.

If investor demand turns out to be greater than expected, the reduction could be even more substantial, they said.

That would put the government within striking distance of returning NatWest to full private ownership 16 years after the lender was rescued from the brink of collapse with £45.5bn of public money.

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This weekend, sources said that options under active consideration by Treasury officials included a minimum investment of £250, to encourage a wide participation in the retail offer.

A ceiling of £10,000 was “likely”, they said, mirroring a 2015 Treasury plan – which was subsequently abandoned – for a retail offering by the Treasury of Lloyds Banking Group shares.

The NatWest offer is also expected to award one bonus share for every ten bought by retail investors and retained for at least a year, the sources added, although they cautioned that final details such as the bonus share ratio and precise investment thresholds could still be amended by officials.

A modest discount to the bank’s prevailing share price will also be applied to encourage take-up.

People close to the decision-making process said that Mr Hunt and Rishi Sunak, the prime minister, were being kept closely informed on the plans.

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Depending upon market conditions, they said an announcement to launch the offer could come in late May or early June.

The green light will be subject to any political turbulence in the aftermath of this week’s local elections, they added.

Shares in NatWest have risen by more than 20% over the last year despite the turbulence surrounding the debanking row involving Nigel Farage, the former UKIP leader.

Dame Alison Rose, the bank’s former boss, stepped down last year after it emerged that she had spoken to a BBC journalist about the closure of Mr Farage’s accounts.

She has since been replaced by Paul Thwaite, whose transition from interim to permanent boss of NatWest was confirmed earlier this year.

NatWest also has a new chairman, Rick Haythornthwaite, who replaced Sir Howard Davies at its annual meeting last month.

Mr Farage, who has threatened to launch legal action against the bank, recently declared his fight with the lender “far from over”.

“For a retail NatWest share sale to work – as outlined by Jeremy Hunt in the Budget – investors must have confidence in the bank,” he said.

“My debanking row with them is far from over.

“They acted in a politically prejudiced way against me and then deliberately tried to cover it up.

“Until they provide full disclosure and apologise for their behaviour, why should any retail customer trust them?”

The government’s stake in NatWest has been steadily reduced during the last eight years from almost 85%.

Sky News revealed earlier this year that ministers had drafted in M&C Saatchi – the advertising agency founded by the brothers who helped propel Margaret Thatcher to power – to orchestrate a campaign to persuade millions of Britons to buy NatWest shares.

NatWest, which changed its name from Royal Bank of Scotland Group in an attempt to distance itself from its hubristic overexpansion, was rescued from outright collapse by an emergency bailout that Fred Goodwin, its then boss, likened to “a drive-by shooting”.

A spokesperson for NatWest said “decisions on the timing and mechanic of any offer are a matter for the Treasury”.

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Lloyds Banking Group in talks to buy digital wallet provider Curve

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Lloyds Banking Group in talks to buy digital wallet provider Curve

Britain’s biggest high street bank is in talks to buy Curve, the digital wallet provider, amid growing regulatory pressure on Apple to open its payment services to rivals.

Sky News has learnt that Lloyds Banking Group is in advanced discussions to acquire Curve for a price believed to be up to £120m.

City sources said this weekend that if the negotiations were successfully concluded, a deal could be announced by the end of September.

Curve was founded by Shachar Bialick, a former Israeli special forces soldier, in 2016.

Three years later, he told an interviewer: “In 10 years time we are going to be IPOed [listed on the public equity markets]… and hopefully worth around $50bn to $60bn.”

One insider said this weekend that Curve was being advised by KBW, part of the investment bank Stifel, on the discussions with Lloyds.

If a mooted price range of £100m-£120m turns out to be accurate, that would represent a lower valuation than the £133m Curve raised in its Series C funding round, which concluded in 2023.

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That round included backing from Britannia, IDC Ventures, Cercano Management – the venture arm of Microsoft co-founder Paul Allen’s estate – and Outward VC.

It was also reported to have raised more than £40m last year, while reducing employee numbers and suspending its US expansion.

In total, the company has raised more than £200m in equity since it was founded.

Curve has been positioned as a rival to Apple Pay in recent years, having initially launched as an app enabling consumers to combine their debit and credit cards in a single wallet.

One source close to the prospective deal said that Lloyds had identified Curve as a strategically attractive bid target as it pushes deeper into payments infrastructure under chief executive Charlie Nunn.

Lloyds is also said to believe that Curve would be a financially rational asset to own because of the fees Apple charges consumers to use its Apple Pay service.

In March, the Financial Conduct Authority and Payment Systems Regulator began working with the Competition and Markets Authority to examine the implications of the growth of digital wallets owned by Apple and Google.

Lloyds owns stakes in a number of fintechs, including the banking-as-a-service platform ThoughtMachine, but has set expanding its tech capabilities as a key strategic objective.

The group employs more than 70,000 people and operates more than 750 branches across Britain.

Curve is chaired by Lord Fink, the former Man Group chief executive who has become a prolific investor in British technology start-ups.

When he was appointed to the role in January, he said: “Working alongside Curve as an investor, I have had a ringside seat to the company’s unassailable and well-earned rise.

“Beginning as a card which combines all your cards into one, to the all-encompassing digital wallet it has evolved into, Curve offers a transformative financial management experience to its users.

“I am proud to have been part of the journey so far, and welcome the chance to support the company through its next, very significant period of growth.”

IDC Ventures, one of the investors in Curve’s Series C funding round, said at the time of its last major fundraising: “Thanks to their unique technology…they have the capability to intercept the transaction and supercharge the customer experience, with its Double Dip Rewards, [and] eliminating nasty hidden fees.

“And they do it seamlessly, without any need for the customer to change the cards they pay with.”

News of the talks between Lloyds and Curve comes days before Rachel Reeves, the chancellor, is expected to outline plans to bolster Britain’s fintech sector by endorsing a concierge service to match start-ups with investors.

Lord Fink declined to comment when contacted by Sky News on Saturday morning, while Curve did not respond to an enquiry sent by email.

Lloyds also declined to comment, while Stifel KBW could not be reached for comment.

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UK economy figures not as bad as they look despite GDP fall, analysts say

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UK economy figures not as bad as they look despite GDP fall, analysts say

The UK economy unexpectedly shrank in May, even after the worst of Donald Trump’s tariffs were paused, official figures showed.

A standard measure of economic growth, gross domestic product (GDP), contracted 0.1% in May, according to the Office for National Statistics (ONS).

Rather than a fall being anticipated, growth of 0.1% was forecast by economists polled by Reuters as big falls in production and construction were seen.

It followed a 0.3% contraction in April, when Mr Trump announced his country-specific tariffs and sparked a global trade war.

A 90-day pause on these import taxes, which has been extended, allowed more normality to resume.

This was borne out by other figures released by the ONS on Friday.

Exports to the United States rose £300m but “remained relatively low” following a “substantial decrease” in April, the data said.

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Overall, there was a “large rise in goods imports and a fall in goods exports”.

A ‘disappointing’ but mixed picture

It’s “disappointing” news, Chancellor Rachel Reeves said. She and the government as a whole have repeatedly said growing the economy was their number one priority.

“I am determined to kickstart economic growth and deliver on that promise”, she added.

But the picture was not all bad.

Growth recorded in March was revised upwards, further indicating that companies invested to prepare for tariffs. Rather than GDP of 0.2%, the ONS said on Friday the figure was actually 0.4%.

It showed businesses moved forward activity to be ready for the extra taxes. Businesses were hit with higher employer national insurance contributions in April.

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The expansion in March means the economy still grew when the three months are looked at together.

While an interest rate cut in August had already been expected, investors upped their bets of a 0.25 percentage point fall in the Bank of England’s base interest rate.

Such a cut would bring down the rate to 4% and make borrowing cheaper.

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Is Britain going bankrupt?

Analysts from economic research firm Pantheon Macro said the data was not as bad as it looked.

“The size of the manufacturing drop looks erratic to us and should partly unwind… There are signs that GDP growth can rebound in June”, said Pantheon’s chief UK economist, Rob Wood.

Why did the economy shrink?

The drops in manufacturing came mostly due to slowed car-making, less oil and gas extraction and the pharmaceutical industry.

The fall was not larger because the services industry – the largest part of the economy – expanded, with law firms and computer programmers having a good month.

It made up for a “very weak” month for retailers, the ONS said.

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UK economy remains fragile – and there are risks and traps lurking around the corner

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UK economy remains fragile - and there are risks and traps lurking around the corner

Monthly Gross Domestic Product (GDP) figures are volatile and, on their own, don’t tell us much.

However, the picture emerging a year since the election of the Labour government is not hugely comforting.

This is a government that promised to turbocharge economic growth, the key to improving livelihoods and the public finances. Instead, the economy is mainly flatlining.

Output shrank in May by 0.1%. That followed a 0.3% drop in April.

Ministers were celebrating a few months ago as data showed the economy grew by 0.7% in the first quarter.

Hangover from artificial growth

However, the subsequent data has shown us that much of that growth was artificial, with businesses racing to get orders out of the door to beat the possible introduction of tariffs. Property transactions were also brought forward to beat stamp duty changes.

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In April, we experienced the hangover as orders and industrial output dropped. Services also struggled as demand for legal and conveyancing services dropped after the stamp duty changes.

Many of those distortions have now been smoothed out, but the manufacturing sector still struggled in May.

Signs of recovery

Manufacturing output fell by 1% in May, but more up-to-date data suggests the sector is recovering.

“We expect both cars and pharma output to improve as the UK-US trade deal comes into force and the volatility unwinds,” economists at Pantheon Macroeconomics said.

Meanwhile, the services sector eked out growth of 0.1%.

A 2.7% month-to-month fall in retail sales suppressed growth in the sector, but that should improve with hot weather likely to boost demand at restaurants and pubs.

Struggles ahead

It is unlikely, however, to massively shift the dial for the economy, the kind of shift the Labour government has promised and needs in order to give it some breathing room against its fiscal rules.

The economy remains fragile, and there are risks and traps lurking around the corner.

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Is Britain going bankrupt?

Concerns that the chancellor, Rachel Reeves, is considering tax hikes could weigh on consumer confidence, at a time when businesses are already scaling back hiring because of national insurance tax hikes.

Inflation is also expected to climb in the second half of the year, further weighing on consumers and businesses.

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