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NatWest has ruled itself out of bidding for UK high-street bank TSB, eliminating one of the leading contenders from a sale process that had been expected to draw interest from some of the country’s largest lenders.
The formerly state-owned bank has decided not to pursue an acquisition of the Sabadell-owned retail lender, and is not actively bidding for it according to three people familiar with the matter.
NatWest’s decision not to make an offer for TSB comes after TSB’s Spanish owner confirmed a Financial Times report that it was working with advisers to examine offloading the UK bank after receiving unsolicited approaches. Bids are due by June 27, the FT previously reported.
Barclays and Santander are among the bidders considering making an offer for the retail bank, according to people familiar with the process.
NatWest declined to comment. It has been looking to expand more aggressively since it returned to private ownership at the end of May, with chief executive Paul Thwaite signalling that he was on the front foot when it came to acquisitions.
The British bank this year made an £11bn approach to Santander for its UK retail business, but was rejected by the Spanish bank, the Financial Times has previously reported.
Thwaite told investors at a Goldman Sachs conference last week that the bank would be “very disciplined” in its approach to acquisitions and had a “very high financial bar” as well as a “very high operational bar” when it comes to dealmaking.
The fate of TSB has been put into question in the past year as Sabadell — which purchased the UK lender from Lloyds Banking Group in a £1.7bn deal in 2015 — tries to fend off a €11bn hostile takeover bid from its domestic rival BBVA.
TSB has about 5mn customers in the UK, and last year posted pre-tax profits of £285mn. It had £46.bn in assets at the end of 2024.
The UK high street lender’s changes in ownership have not always been smooth. When TSB transitioned from former owner Lloyds’ legacy infrastructure to Sabadell’s IT system in 2018, it left 2mn customers temporarily locked out of their accounts, costing the bank £49mn in fines.
Sabadell declined to comment.
Additional reporting by Barney Jopson in Madrid
