Britain is set to cancel a significant sale of shares in NatWest Group (NWG.L), which was intended to be made available to the general public, according to three sources familiar with the matter.
This decision comes after Prime Minister Rishi Sunak announced a general election scheduled for July.
The lender's shares, which have seen an increase of over 40% this year, experienced a 1.4% decline in trading. Investors were awaiting official confirmation regarding the postponement of the proposed offer until after the July 4 poll.
Chancellor Jeremy Hunt and UK Government Investments, the agency overseeing Britain's stake in NatWest, had been orchestrating the sale to advance ambitions of fostering broader retail ownership of UK stocks.
However, with the election looming sooner than expected, the decision on how to divest the taxpayer's remaining shares in NatWest will be left to the next government, according to the sources.
Analysts at Peel Hunt noted that the sale couldn't proceed before an election. Additionally, it remains uncertain whether the Labour Party, widely anticipated to form the next government, would pursue the initiative.
"Although the UK Government is a passive investor only in NatWest, the presence of the State on the share register in our view is not helpful for the rating of NatWest's shares," they said in a note.
