NatWest rushes to introduce debanking rules after Nigel Farage row

Employees of the private bank NatWest Coutts bankrupted the politician. Photo: Nigel Farage, honorary president of the UK Reform Party

NatWest has introduced new debanking rulesto prevent a repeat of the crisis that hit the lender last year.

Laws requiring banks to notify customers three months before closing accounts, will take effect after the summer, extending the current notice period from 60 to 90 days.

However, NatWest chief executive Paul Thwaite said the bank introduced them internally in January to get ahead of legislation.

Chancellor Jeremy Hunt introduced the proposals after staff at private bank Coutts, part of NatWest, decided that Nigel Farage's views «did not align» with the bank's own values ​​»as an inclusive organisation».

The crisis provoked the departure of the former leader. chief executive Dame Alison Rose after she admitted discussing the case with a BBC journalist.

Mr Thwaite said: “I am pleased to say that we have already implemented an extension to notice periods from 60 to 90 days before the bill is implemented.

“As a bank, I was very keen that we implement this as quickly as possible.”

After the scandal, a report by law firm Travers Smith found several flaws in the way Natwest handled the closure of customer accounts and proposed a number of changes.

Mr Thwaite said he was “absolutely committed” to implementing the procedure. proposed changes as quickly as possible.

“For the avoidance of doubt, we do not expose anyone for having legitimate political beliefs or values,” he added.

NatWest said on Friday its operating profit fell to £1.3 billion in the three months ended March, compared with £1.8 billion in the same period last year. However, this exceeded the city's expectations.

The drop was linked to a slowdown in the mortgage market last year as borrowers paused applications due to rate uncertainty.

Demand for mortgages fell between June and December, sparking intense competition among lenders. playing with a smaller circle of borrowers.

NatWest decided to leave the market and refused to offer lower prices, which had a negative impact on mortgage lending.

>Mortgage lending fell to £5.2 billion from £9.9 billion in the same period last year.

Mr Thwaite said demand for mortgages had increased this year and higher lending levels are due to be reached later this year.

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A “Tell Sid”-style retail sale of shares is planned to sell off the government's financial crisis-era stake in the bank.

The taxpayer's share has fallen from 46% at the end of 2022 to less than 28% this year.

The retail offer could arrive as soon as June, but NatWest has stressed that any decision will be in the hands of government.

Mr Thwaite said the group was laying the groundwork for retail.

“If the government does proceed with a retail share offer, it is clear that we need to be prepared for a number of key actions, whether that be the preparation and issuance of a prospectus or the potential for a large number of retail shareholders when this transaction is completed.”

“We are taking the necessary steps and measures to be prepared for this.”