Donald, a former Credit Suisse banker who became chief executive as the pandemic took hold in March 2020, confirmed the scheme had ended. “There’s an enormous amount of stuff that has been done not necessarily visible. Often you find that there are other solutions.” Ultimately only one company benefited: the south Wales-based steelmaker Celsa, which was given a senior debt facility. But Donald said that this did not reflect the number of inquiries from companies seeking government help. In almost all other cases, he said, a private-sector solution had been found. The UKGI’s wider role pre-pandemic was managing a £945bn portfolio of wholly and partially owned state enterprises, including NatWest, Channel 4, the Post Office, Land Registry and Urenco, the nuclear fuel supplier.
Donald said the stewardship of the Covid loan portfolio was focused on two of the emergency schemes: the Bank of England’s Covid Corporate Financing Facility and the Coronavirus Large News Interruption Loan Scheme, which carries state guarantees of up to 80 per cent. “We’re just watching it very closely,” he added. “Who knows what happens next in terms of the pressures of the next stage of the pandemic on different sectors?”
UKGI also helped with the Treasury’s ‘Project Birch’ plan to take stakes in critical companies whose operations had been affected by the pandemic. This included analysing the “potential pressures that will exert themselves on the anticipated repayment schedule. It’s what I would call credit watch,” he said.
In May, UKGI sold down £1.1bn in NatWest shares, its second disposal in two months. This reduced the government’s stake to under 55 per cent, 13 years after the bank, known then as Royal Bank of Scotland, was nationalised and brought under state control during the financial crisis. Asked about further sales of NatWest shares, he said: “I would expect so, but it’s always subject to conditions. After a bit of a lull, we have made a little bit of progress this year. Our obligation is to make sure we are monitoring at all times opportunities to sell on a value-for-money basis.” In a wide-ranging interview with the Financial Times, Donald said he expected further sales of shares in NatWest this year given the strength of equity markets and the removal of curbs on dividends.
Donald signalled that he expected a further selldown in NatWest shares by the UK government this year © Jason Alden/Bloomberg It provides a level of private sector knowledge, including bringing in outside experts, to advise and implement policy for government departments.
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