The Natwest Group PLC (LON: NWG) share price fell 2.58% after news reports regarding its bonus pool for the past financial year. NatWest Group is on the verge of distributing approximately £350 million in bonuses to its staff amid government plans to potentially significantly reduce its stake in the bank through a public share offering.
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.
This move comes as the bank is about to announce its yearly financial outcomes, expected to showcase its most successful year since being saved by UK taxpayers. Although the bonus pool is set to be a bit less than the previous year's £367 million, it comes in a year where profits are anticipated to rise, thanks in part to increasing interest rates.
The upcoming financial results will be presented under the temporary leadership of Paul Thwaite after a year filled with challenges for the bank. One notable controversy in 2023 involved the closing of Nigel Farage's accounts with Coutts, a subsidiary of NatWest, which was initially attributed to commercial reasons.
However, it later emerged that his political views significantly influenced the decision. This incident led to the departure of Dame Alison Rose, who lost over £7 million in bonuses and incentives due to her involvement in the matter.
The bank, soon to be led by Rick Haythornthwaite, is seeking a permanent CEO with the assistance of executive search firms. The selection of a new leader is deemed essential by UK Government Investments, which oversees the government's 35% share in NatWest, before initiating a public share offer as announced by Chancellor Jeremy Hunt.
The topic of bonuses at NatWest has been a sensitive issue since the bank received a £45.5 billion bailout in 2008. Once known as the Royal Bank of Scotland, its near-collapse was a hallmark of banking excesses under lenient regulations.
Following extensive restructuring and asset sales, the bank has normalised, with bonus payments fluctuating between £300 million and £400 million in recent years. Since the bailout, NatWest imposed a cap on cash bonuses at £2,000 while significantly reducing its investment banking operations.
Natwest (NWG) share price.
The Natwest (NWG) share price fell 2.58% to trade at 205.90p from Friday’s closing price of 211.35p.
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YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.