Paul Thwaite could earn up to £7.7m, and move comes as bank prepares to return to full private ownership. NatWest wants to increase its chief executive’s maximum pay by more than 40%, as the banking group prepares to return to full private ownership 17 years after it was bailed out by taxpayers during the 2008 financial crisis. The high street lender, previously known as Royal Bank of Scotland, paid its chief executive, Paul Thwaite, £4.9m in his first full year in the role in 2024, shy of his maximum potential payout of £5.4m.
The board of NatWest is now proposing raising his maximum pay by 43%, giving him the chance to earn up to £7.7m for a single year’s performance. A model produced in the annual report shows that his pay package could soar to £9.5m if there was a 50% increase in NatWest’s share price – given much of the payout is linked to long-term bonuses made up of the bank’s own stock. It comes as NatWest announced a 24% rise in its banker bonus pool, which will be shared by its top-performing staff, to £446.6m. That is the biggest bonus pool shared by NatWest bankers since 2013.
The jump in potential pay coincides with NatWest’s expectations that it will return to full private ownership later this year. The Treasury spent almost £46bn to bail out RBS at the height of the financial crisis in 2008, leaving taxpayers owning about 84% of the lender. That stake has since been reduced to less than 6.98% through incremental share sales. That approach is expected to continue until NatWest is back in full private ownership, after a campaign by the former Conservative government to sell shares to the public, fronted by Sir Trevor McDonald, was ditched.
Thwaite now expects to return the bank to private hands by June. The payout news came as NatWest eked out a 0.3% rise in pre-tax profits to £6.2bn for the whole of 2024, and announced a year-end dividend that will result in £1.2bn – or 15.5p a share – being given to shareholders. That includes the Treasury, which at its current sub-7% stake, could end up receiving about £83.8m of that investor payout.
While Thwaite’s new pay policy will have to be put to NatWest shareholders at its annual general meeting in April, pay campaigners say the return to a high bonus culture is not in the UK’s wider interests. Sign up to Business Today. Get set for the working day – we'll point you to all the business news and analysis you need every morning. after newsletter promotion. Luke Hildyard, the executive director of the High Pay Centre thinktank, said: “As memories of the global financial crisis dim, banks and big corporations are returning to the pay culture that sent inequality soaring and contributed to the collapse of the economy. Nobody wants this, and it isn’t in our economic interest.”.
Hannah Dewhirst, the head of campaigns at Positive Money, a non-for-profit advocacy group, said the move also stood in stark contrast to the challenges that some consumers were still facing because of high interest rates. “There is a bitter irony to NatWest paying bankers bumper bonuses while the public – who bailed them out 17 years ago – struggle under the weight of the same high borrowing costs now flooding its profit pool.”.
