How can it have come to this?
Just eight months ago NatWest was sailing serenely back to the calm waters of banking respectability after the years of turmoil following its emergency nationalisation during the financial crisis. Its then highly regarded chief executive, Dame Alison Rose, revealed that profits in 2022 were up by a third to £5.1 billion, while she was rewarded with the first bonus for a NatWest CEO since 2008, taking her total remuneration to £5.25 million.
Now look at it.
Today shares in NatWest — Britain’s fourth biggest bank and still 38 per cent owned by the taxpayer, don’t forget — saw their value fall by 16 per cent at the start of trading as investors took fright at the ongoing fallout from Farage-gate and a downgrade on the outlook for lending margins.
The NatWest board have looked leaden-footed ever since the outset of this fracas and they certainly picked the wrong man to start a fight with. They also face a second front with a lawyered and PR’d up Dame Alison, who will argue that she is entitled to much, if not all, of her pay-off, which is worth a potential £10 million.
Sir Howard Davies and his colleagues face an unpalatable choice. Even a single £1 pay-off will further fuel Farage’s enraged sense of injustice. But how far can they cut back Dame Alison’s entitlement without risking a hugely embarrassing day in court with its former CEO?
The whole situation is an incredible mess that is harming the interests of shareholders and taxpayers.
Farage has the bit between the teeth on this one, and as we know all too well from the Brexit campaign he is a highly effective campaigner. Sir Howard certainly has some tough decisions to make. But then again, that is why he is paid £750,000-a-year for a part-time job.
