NatWest has said it “welcomes” the government’s commitment to returning it to full private ownership after the chancellor announced she was scrapping a retail share sale in the high street bank.

Rachel Reeves said the plans, announced by the previous Conservative administration, were a “bad use of taxpayer money” and suggested the bank’s remaining state-owned stock would now be sold off to large, institutional investors instead.

Officials had been gearing up for a mass-market sale this summer, with shares offered to ordinary investors at a discount to the bank’s prevailing share price, along with “bonus” share offers, to encourage take-up.

However, the rollout – which was due to be backed by an advertising campaign similar to the “Tell Sid” push that accompanied the sale of shares in British Gas following its denationalisation in the 1980s – was put on hold by Rishi Sunak’s decision to call a sudden general election.

Read more: Why things look rosy for NatWest 12 months on from debanking crisis

The bank – formerly known as Royal Bank of Scotland – was at one stage 84% owned by the taxpayer after it was bailed out with a total of £46bn of public money in 2008 and 2009 during the financial crisis.

The Treasury has since been selling down its stake in the lender, with the state’s stake dropping to below 20% in recent weeks.

However, it was estimated the retail share sale could end up costing taxpayers up to £450m.

The chancellor said the government still intended to “fully exit” its shareholding in Natwest by 2025-26.

Please use Chrome browser for a more accessible video player

Speaking on Monday, she told the Commons: “But having considered advice, I have concluded that a retail share sale offer would involve significant discounts that could cost taxpayers hundreds of millions of pounds.

“It would therefore not represent value for money.

“It will not go ahead. It’s a bad use of taxpayer money and we will not do it.”

Read more from business:
Evri to hire 9,000 new staff
Half of UK TV and film staff out of work
Royal Mail bidder talks over £3.6bn deal

Be the first to get Breaking News

Install the Sky News app for free

A NatWest Group spokesman said: “We welcome the chancellor’s commitment to returning NatWest Group to full private ownership.

“This is a shared ambition that we believe is in the best interests of both the bank and all our shareholders.”

Keep up with all the latest news from the UK and around the world by following Sky News

Last week, the bank revealed it had spent £24m on the scrapped plans, including advertising.

However, it is understood that some of that amount is expected to be re-used for general advertising uses, although the bill also covers legal fees and expenses.

Related posts:

Fortnite video game makers file EU antitrust case against Apple Heathrow reports £2.9bn of COVID losses and urges jab-led reopening of the skies Food industry’s ‘Chicken King’ warns of looming Xmas turkey crisis as ‘pingdemic’ and Brexit hit staffing Which company will be next to dump pariah state Russia? British Gas owner moves to end gas purchases from Russian suppliers Staycation giant Parkdean halts sale amid UK economy fears Coloured carbon fibre pioneer Hypetex secures 24Haymarket angel backing Hyve suitor Providence buzzes around Cannes Lions owner Branson-backed Virgin Voyages sets sail on quest for new funding Least and most affordable places to rent revealed Northern Gritstone injects £2m into bioplastics developer Floreon OpenAI drama, Italy’s public debt, and Huel sales surge